1920-06-09

QUESTIONS.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)

Mr. McKENZIE:: 1.	Has any person been appointed Fishery Officer for Isle Madame, or for Isle Madame and the western portion of the county of Richmond, Nova Scotia? If so, who accepted such appointment?
2.	Was a Qualifying examination set for applicants for such position? If so, how many wrote such examination?
3.	Did any returned soldiers belonging to the county of Richmond write such examination? If so, what are their names?
4.	Has any request, been made by returned soldiers for another examination?
5.	What are the names of the returned soldiers, if any, who made such request, and on what ground was it refused?
6.	Why has not a resident of Richmond county been given the appointment?


Hon. Mr. SIFTON:: 1.	Yes, Albert E. Thurgood, a returned soldier, previous appointees declined the position, Mr. Thurgood has not yet advised the commission of his acceptance.
2.	Yes. One hundred and forty-eight.
3.	Yes, R. T. Sampson.
4.	Yes.
5.	T. A. Boyle, Jas. A. Goulett, Harry T. Boudreau, A. G. Langlois, -G. G. MacNeil, sec.-treas. of the G.W.V.A., Dominion Command, and others. The first examination furnished enough returned soldiers eligible to fill all vacancies.
6.	Only returned soldiers were appointed and the one returned soldier in Richmond county who tried the advertised examination was R. T. Sampson who was appointed to the eastern portion of Richmond county.


PARLIAMENT POST OFFICE.
Mr. TOBIN:: During what hours of the day is the Parliament Post Office supposed to be kept open for the convenience of members during the sessions of Parliament (a) on days during which the House is in session: (b) on days other than holidays when the House does not sit or when the House is adjourned at or before 6 p.m.; (c) on Sundays and holidays?


Rt. Hon. Sir ROBERT BORDEN:: Days
the House is in session: (a) from 6.30 a.m. to adjournment of the House; (b) on Saturdays from 6.30 a.m. to 10.00 p.m., other days from 6.30 a.m. to 11.00 p.m.; (c) on Sundays from 9.00 a.m. to 2.00 p.m.; 4.00 p.m. to 6.00 p.m.; 8.00 p.m. to 9.00 p.m.; on holidays from 6.30 a.m. to 2.00 p,m., and from 6.00 p.m. to 9.00 p.m.


CANADA WHEAT BOARD.
[Stage Direction]
Mr. STE-VENS:
Having reference to the following despatch published In the Montreal Gazette:

"Ottawa, June 3.-The Government, in answer to the telegram from the Canadian Council of Agriculture, urging that necessary steps be taken to have the powers of the Canadian Wheat Board continued at least for another year, sent a reply promising earnest consideration of the request."
1.	(a) Is it the intention of the Government to deal with the proposal of the Canadian Council of Agriculture by legislation this session, or (b) has the Government power under any existing statute to deal with it by Order in Council, and (c) if so, will such powers be utilized?
2.	Is the Government aware that control of marketing of wheat has been abandoned by the United States Government?
3.	Under the powers given the Canada Wheat Board is it the duty of said Board to secure for ithe seller the highest possible price for wheat in the world market?
4.	Has the marketing of the Canadian wheat crop by the Canada Wheat Board resulted in the farmers receiving the highest market price for their wheat?
5.	Has the marketing of the Canadian wheat crop by the Canada Wheat Board resulted in lowering the cost of flour to Canadian consumers?
Sir GEORGE FOSTER:: 1.	The matter is now being considered by the Government. [Legislation will be necessary if the crop for the succeeding year is to be controlled, as was the crop for the past year.
2.	Yes.
3.	It is the duty of the Canadian Wheat Board to secure the best possible market prices for wheat according to prevailing rates in the world market.
4.	Yes.
5.	This is largely a matter of opinion. In order to come to a reasoned judgment, one would have to know what would have been the cost of flour to the consumers if the crop had not been controlled, and what would have been the price paid by the millers for wheat if prices had not been controlled. It is impossible to give an answer to that.


UNOPPOSED MOTION FOR PAPERS.
[Stage Direction]
iMr. SINCLAIR (Antigonish and Guys-borough):
For a copy of all correspondence, telegrams, petitions and other papers and documents in the possession of the Naval Department and of the Board of Civil Service Commissioners relating to the appointment of a fishery overseer in the municipality of Guyfiborough, N.S.
iST. LAWRENCE NAVIGATION.-ILE d'ORLEANS.
On the Orders of the Day:
.Mr. H. E. LAVIGUEUR (Quebec county): I should like to draw the attention of the Government, and particularly of the Minister of Marine and Fisheries (Mr. iBallan-tyne), to the dangerous state of affairs
which exists on the Island of Orleans near Quebec. In the fall of 1918, great damage was caused to the wharves at St. Jean, St. Laurent, Ste. Famille, and St. Francois, on the lie d'Orleans. A sum of $200,000 was voted for repairs on those wharves. It was reported to me some days ago-
Mr. SPEAKER:: Order. The hon. membei is in effect making an argument. Would he summarize any question he wishes L put.


Mr. LAVIGUEUR:: I will do so. It was reported to me that the lighthouses had suffered great damage on account of the wharves not having been repaired; that those lighthouses are liable to be destroyed by the high tide at any time, which would constitute a great danger to navigation on the St. Lawrence. I, therefore, warn the Government of the serious state of affairs which exists in regard to navigation on the St. Lawrence.


MEN RELEASED ON HABEAS CORPUS RE-ARRESTED.
[Stage Direction]
On the Orders of the Day:
Hon. RODOLPHE LEMIEUX (Maison-neuve and Gaspe):: Is the Minister of Justice now in a position to give me the information in regard to the case to which I referred yesterday?
Rt. Hon. C. ,1. DOHERTY (Minister o.f Justice): I think I may give the information now. The fact is that the Attorney General of the province, acting in co-operation with the officers of the penitentiary and an officer representing the Department of Justice, did arrest the two men referred to, and they have been returned to the penitentiary. As I said yesterday, we are advised that a judge (sitting on a writ of habeas corpus has not jurisdiction to override the judgment .and conviction of the Court of King's Bench upon an indictable offence which ordered these men to be confined to the penitentiary for a long period of years. I am not aware whether it was suggested that there was any irregularity in the way the men were conveyed to the penitentiary at the outset. But even if there were, the sentence against these men stands just as though the intervening incidents had not taken plac there is the judgment of the competent court imposing that sentence upon these men, which .sentence has never been satisfied. As I have said, we are advised that there is not jurisdiction in a judge upon a writ of habeas corpus to override a conviction by the

Court of King's Bench and nullify a sentence imposed by that court. That would involve an appellate jurisdiction in one judge over the formal judgment of the Court of King's Bench, the highest court in our province dealing with criminal matters- Both the provincial authorities charged with the enforcement of law and ourselves are fully prepared to take the responsibility for what has been done to vindicate the authority of law, and to justify it before 'any tiibunal.


Rodolphe Lemieux: Mr. Speaker, if you
please, I do not question the facts as related by the Minister of Justice; he knows them better than I do. But does it not strike him that if an error has been made by the judge who granted the writ Of habeas corpus, an appeal lies from that judgment?


Edgar Nelson Rhodes: Order.


Mr. DOHERTY:: An appeal does not
lie; that is the point.


Edgar Nelson Rhodes: The hon. member (Mr. Lemieux) has put his question and received an answer; that is as far as he may proceed on the Orders of the Day.


Mr. BUREAU:: Do I understand the
minister to say that the Department of Justice have expressed an opinion confirmatory of the action taken by the Attorney -General of the province of Quebec?


Charles Joseph Doherty: Yes. The action was
taken by the Attorney General of the province of Quebec in co-operation with our officers. It was necessary that our officers should intervene so that the men should be .identified as those who were in the penitentiary. Moreover, the view entertained by the provincial authorities is the view entertained by our law officers. Of course it belongs to the provincial authorities to enforce the judgment of the court, but we were quite prepared to take the responsibility of co-operating with them in returning these men to the penitentiary.


Jacques Bureau: You must have taken
it as a war-time measure.


Charles Joseph Doherty: We took it as a peacetime measure, for the vindication of the judgment of the courts in the proper administration of law.	,


Mr. ARCHAMBAULT:: Does not my hon. friend believe that this is purely a question ol law and that redress could be obtained-	,


Edgar Nelson Rhodes: Order.


REPORT OF STATISTICAL DEPARTMENT.
[Stage Direction]
On the Orders of the Day:
Mr. FRANK ICAHILL (Pontiac):: In
view of the fact that the 'Statistical Department are not ready to submit their report for 1919-20, may I ask the Government whether members of this House are permitted to go to that department and obtain information?
Sir GBORGE' FOSTER (Minister of Trade and Commerce):	My hon. friend is perfectly at liberty to do that. I will issue a formal invitation to him, if he requires it, to go and bother the Dominion Statistician for any statistics he wants. I think he will find them there.


Frank S. Cahill: I was refused certain information .there; that is why I wanted to get a statement from the minister on the point.


Sir GEORGE FOSTER:: Of course, it
depends somewhat on the information that my hon. friend requires. The Statistical Department gathers its information under oath of secrecy in respect of a great many things, and (t'here are certain matters which it cannot disclose. But my hon. friend may obtain the general run of statistical information there.


INCOME WAR TAX ACT, 1917, AMENDMENT.
[Stage Direction]
On motion of Sir Henry Drayton (Minister of Finance), the House resumed from June 8, consideration in committee of Bill No. 168, to amend the Income War Tax Act, ,1917, Mr. Boivin in the Qhair.
The CHAIRMAN:: When this Bill was last before the committee the first nine clauses had been read and considered, and section 10 had also been read and was under consideration.


Joseph Archambault: Do I understand that section 2 has been carried?
The /CHAIRMAN: Sections 4 and 5 stand. The other sections, from 1 to 9 inclusive, have been carried.


Joseph Archambault: I was under the impression that section 2 had been allowed to stand. Will fche minister allow me to refer to section 2?


Georges Henri Boivin: (Mr. Archambault
moves that the committee do now revert to the eonsid'araltion of section 2 of the Bill.


[Stage Direction]
Motion agreed to.

On section 2-determination of deficits >and losses.
Joseph Archambault: I believe that the minister wishes to treat the committee with fairness and that he is even prepared to accept suggestions made by the Opposition. I am sorry that the minister was not in his seat when I made a few remarks on the Budget. On that occasion I suggested that the exemption in respedt of each child be increased from $200 to $500. Everyone who is Messed with children knows that it costs much more than $200 for the upkeep of a child in these days. I have made an offhand estimate of what it costs for the yearly upkeep of a child of ten or twelve years of age, and the figure which I have arrived 'at is $563.30. Everyone knows that one of the causes of race suicide and voluntary sterility is the high cost of the upkeep of children. If a married man has an income of $4,000 and no children he pays income tax on $2,000, the assumption being that the $2,000 upon which he is taxed is that part of his income which is not absolutely necessary for the ordinary needs of life. On the other hand, if he has children !he needs that $2,000 for the upkeep of his children, so that, as a matter of fact, he pays tax on income that is necessary for the upkeep of his family. I am sure that the minister realizes the unfairness of limiting the amount of exemption of each child to $200. I therefore move that the following clause he inserted immediately after clause 1 as clause 2 of the Bill:
Paragraph (b) of subsection 2 of section one of the said Act as enacted by chapter fifty-five of the statutes of 1919, is hereby amended by replacing the words "two hundred" in the first line of said paragraph by the words "five hundred."


Sir HENRY DRAYTON:: There are some difficulties in meeting the suggestion of my hon. friend. One of the chief objections raised by many people to the basis of income taxation as carried on in Canada is that the right to tax is not made sufficiently general and that existing exemptions are higher than they ought to be. It is held' that the burden should be spread to a somewhat further degree so that every citizen would feel to a larger extent that he was contributing to the expense of the country and was interested in proper and economic government. The exemption for children is a provision which applies in different countries. It applies in Great Britain, where the exemption for the first child is, if I remember rightly, $200, with a smaller exemption for each subsequent
child. So that Great Britain's basis of exemption on the score of children is the same as ours for the first child, being less than ours for subsequent children. It must. also be borne in mind that the exemption limit on incomes in Great Britain is lower than it is in Canada. In the United States the exemption is exactly the same as our own, and the initial exemption granted for all incomes is also higher than that of Great Britain. I would point out to my hon. friend that if we were to increase the exemption for children in the manner contemplated it would mean that a man with three children would be exempt from all taxation until his income was in excess of $3,500 a year, and the man with six children would be exempt until his income exceeded $5,000.


Joseph Archambault: He deserves it.


Henry Lumley Drayton: Probably he deserves it, but, on the other hand, I think he is likely to be much happier than the man who has no children. The married man who has ten children would have to have an income of $7,000 before he could be called upon to pay five cents to the treasury.


Joseph Archambault: Hear, hear, for
him.


Henry Lumley Drayton: That is a class of exemption of such a character that it would make grave inroads upon the public revenue. It would so tremendously increase our present scale of exemptions that I must ask the committee to reject the proposal.


Joseph Archambault: I suppose my
hon. friend will admit that $200 is not sufficient for the upkeep of a boy of ten or twelve or fourteen years of age.


Mr. EDWARDS:: What were the figures my hon. friend gave?


Joseph Archambault: I could give the details; the total is $563.30. Does my hon. friend want the details?


William Cameron Edwards: I have had sufficient experience to be conversant with the details.
An lion. MEMBER: That is why you were smiling a moment ago.


William Cameron Edwards: I was smiling because I wondered why my hon. friend (Mr. Arch-ambault) omitted the $63.30 in stating the amount. He would have been more logical if he had asked for exemption to the amount of $563.30.


Joseph Archambault: 
Henri-Edgar Lavigueur: I heartily support the motion of the hon. member for Chambly-Vercheres. I think I have sufficient warranty for speaking on this subject, for I am the father of twenty-eight children. It will be conceded, therefore, that I know what I am talking about. I heard the minister state that the father of three children would have to have an income of 83,500 before he would pay the tax; that the father of six children would have to have an income of 86,000-I may be wrong, but that is what I understood him to say-and that the father of ten children must be in receipt of $7,500 before being taxable. I submit to the minister that a man with an income of $7,500 cannot reasonably support and educate ten children if he is subject to income taxation. It is as much as he can do to bring up such a family, as it ought to be brought up, on that income; and I would supplement the motion of the hon. member (Mr. Archambault) and suggest to the minister that the father of ten or twelve or eighteen children should be entirely free from taxation.


Joseph Archambault: He should receive a bonus.


Mr. STEIN:: As seconder of the motion I suggest that if the minister is not disposed to accept it in its entirety he should at 'least make some concession and raise the amount of exemption from $200 to $300. The minister has spoken of similar exemptions that exist in Great Britain and in the United States. I believe, .from what I have read in the press recently, that the exemptions in France are much higher than they are here or in the United States and Great Britain. My hon. friend (Mr. Archambault) suggests a bonus, and I think that bonuses are given in France to the fathers of large families. I have here a copy of The Montreal Gazette of March 9, 1920, on the new inheritance tax in France. In that paper the following appears:
Paris, March 8.-France's new inheritance tax will be a novelty. It will be based upon the principle that the more children man has the less estate should be taxed, and vice versa, the fewer children he has, the more tax should be levied. If a man dies without children, the state will take fifty per cent of his estate. If there is one child, the state will take 33 per cent. If there are two children to toe provided for, the tax will toe 25 per cent. Should there

toe three children the tax will be 18j per cent. In the case of four or more children there will be no inheritance tax. Fiscal experts estimate this new tax will bring in 3,000,000 francs annually.
The French Government statistics show that half the French army in the world war came from families having four or more children. The same statistics show that one family in five has as many as four children. Further, more families whose estates are the largest are not those who have four or more children as a rule.
I 'think the minister should raise the amount to $300; this would be acceptable to hon. members on this side.


Rodolphe Lemieux: Mr. Chairman, I am in sympathy with the amendment drawn up by my hon. friend from Chambly and Ver-oheres (Mr. Archambault). I am surprised that this Government, or any Government, should refuse to encourage large families, and this is a proper means of encouraging large families. We are advertising our country abroad to get immigrants, but after all there is nothing like the Canadian-born. He is preferable to the American, Australian, or even British. The asset we most require in this country is the Canadian-born. The principle embodied in the amendment has existed for all time in the history of nations. I would not care to delve into ancient history, but I might recall to my classical friend, the right hon. the Minister of Trade and Commerce (Sir George Foster), that in the laws of old Rome, Augustus, the Emperor, enacted legislation by which the fathers of twelve children were exempted from all taxation and were given lands out of the public domain. This legislation existed all through the Middle Ages in Europe. It was enacted by Louis XIV in France. Coming to more modern times in America-indeed in Canada -the Government of the late Honone Mer-cier in the province of Quebec enacted similar legislation. Grants were made in our province to the fathers of twelve living children. They were made out of the Crown lands and1 they consisted of 100 acres, if I remember well, to each father of twelve children.
In France, unfortunately, the birth rate has been decreasing for many years. Indeed, one of the regrets of French patriots at the beginning of the war, and before the war, was to notice that each year at least one great city was lost by the falling off of the birth rate in France. What made the apparent superiority of the German nation? In 1870 'Germany had the same population, or about the same population, as France; forty years later Germany had nearly doubled its population. In view of

this appalling result, the patriots of France, laymen, priests, free thinkers and practising 'Catholics, have joined hands of late in' order to promote a higher 'birth rate in the old Mother country. Premiums have been given by wealthy Frenchmen, and by patriots through some of the academies of France to fathers of large families, and the French Government at last has awakened and through its legislation has quite substantially encouraged a higher birth rate by exempting from taxation the fathers of large families.
This is a very important topic. It may not so appear when you consider the amount involved in each individual case, but it is a most vital problem for Canada. We have a large country-a beautiful country. The resources of the country have been hardly scratched. We have the potential wealth within the grasp of our hands, but we have not the population. Should we not by all means promote the growth of a healthy and strong population?
We are advertising Canada throughout Europe. I see in the papers every day that American immigrants are beginning afresh their peaceful invasion of the Northwest provinces. Well and good; I am delighted to hear it. The American immigrant is an excellent immigrant. He understands the conditions in Western Canada perhaps better than any other immigrant in the world, but, after all, the best, the most desirable of all citizens is the Canadian-born. Let us through our legislation encourage the increased birth rate of the Canadian.
I said something the other day to the House which I would like my hon. friends to bear in mind just as an illustration of what a steady increase in the birth rate must mean for Canada. Perhaps it is a little selfish on my part, being a Canadian of French descent, to make boast of the fact, but I do make boast of it because the homage is due to the patriotism of our mothers and grandmothers and to the wisdom of our legislators and clergy. I said, and I repeat to-day, that at the time of the Conquest, or if you prefer, at the time of the cession of French Canada to Great Britain, there were in Canada at most
80,000	people of French blood. In 1840, according to statistics, there were barely
1,000,000 French Canadians in Canada. Today there are in Canada 2,500,000 French Canadians at least, and I do not take into account the French Canadians across the boundary. I am told on the best authority that there are no less than 2,000,000 French Canadians in the United States. If it is true, Sir, that a population will double
every thirty years, I invite your attention, ;Mr. Chairman, to this fact that if our people are God-fearing, as they are and a3 they have always been, if they follow the precepts of the Lord, if marriage is encouraged and divorce discouraged, in thirty years from now, speaking from a French Canadian point of view, and it is not a narrow or sectional point *of view, you will have 5,000,000 Canadians of French descent in Canada. In sixty years that number will again bo doubled, and what is a period of sixty years . in the history of a people? This statement is based on the best authority. Lenoy-Beaulieu, who is known as the highest authority on political economy in Europe, once said that the birth rate of French Canada was simply astounding, and he attributed it to the simple life, to the religious life of my fellow countrymen. I do not speak in disparagement of the other races, I know, as a matter of fact, that in the old families in England the children are numerous. I know, too, that in Ireland and in Scotland children are many. I regret to say, and I base my opinion on what a former president of the United States, the late Theodore Roosevelt said, that in the American Commonwealth they have followed another course, and to-day we have the result of race suicide. By promoting divorce before the c6urts, by living a wild life in the cities, by distracting and luring the farming population from rural life tio the cities, they have abolished the old time-honoured family life, which was the pride of the Pilgrim Fathers. This is a very serious problem, Mr. Chairman, and it has a bearing on this taxation measure. I say to my hon. friend the Minister of Finance that he will oe a good Minister of Finance if first lie practises economy, and if second, by the distribution of the taxation in this country, he takes the proper view of this national problem, namely the growth of the Canadian born. By his taxation measure he could indirectly-indeed he could directly- promote the increase of our population.
I have said enough, Mr. Chairman. I am in earnest, and I say toi the Minister of Finance that he will get a halo from this Parliament if he promotes the growth of Canadian-born population in Canada


William Cameron Edwards: I want to enter my protest against any change in the law as it is now, or against the acceptance of the amendment as proposed by the hon. member for Chambly-Vercheres (Mr. Archam-bault). Tf we were to accept in .all serious-

ness, as of course we should, the arguments and the statements advanced by the hon. gentleman who has just taken his seat we might sum up those arguments in one sentence-it is the advancing of a plea-perhaps an indirect plea but nevertheless a plea-to exempt from taxation the French Canadians in this country.


An hon. MEMBER:: Oh, no.


William Cameron Edwards: That is practically what it amounts to.


An hon. MEMBER:: Not at all.


William Cameron Edwards: Now there have been many means devised at different times to avoid the payment of taxes. For hon. gentlemen to get up and to deliberately and coolly suggest this way as a means of getting out of paying taxation is to say the least of it somewhat unique.


An hon. MEMBER:: It is a good way.


William Cameron Edwards: That is about what it amounts to.


Mr. MICHAUD:: Try it,


William Cameron Edwards: I will leave it to my hon. friends opposite who boast of their abilities along that line. Now in all seriousness, Mr. Chairman, it seems to me we should regard this matter of taxation at least from this standpoint: that the people of this country must realize .that we have incurred a large debt as a result of the war and the lesson conveyed by this taxation is that every person should, as far as possible, get his shoulder under that debt and help to lift it. There is something which I think we should not now entirely overlook in the practical application of the tax. Take in the province of Quebec which is largely a rural province-.that is the most of the population are engaged in farming. I venture to say that very few of the farming population in that province will be affected by the tax as it stands to-day. They are exempted up to $2,000, and if they have five children that means a further exemption of $1,000. If hon. gentlemen opposite will tell me that the farmers in the province of Quebec are enjoying incomes in excess of two or three thousand dollars I will be very glad to hear it. I can assure them that is not the case so far as the farmers of Ontario are concerned, and it is certainly not so as regards my constituency, very few of them are affected by this taxation. I think the exemption on $2,000 is suitable recognition. I think it gogs far enough, and that we would be making a mistake if

we accepted the amendment of the hon. gentleman which I have no doubt is presented in all good faith.


Mr. BURNHAM:: I should like to say that the reason I wish to support the Minister of Finance is, that I am .against .the proposition which is being urged here to-day since it is not the principle which has been adopted in taxation in Canada. It would be all very well if this principle had been discussed in a resolution earlier in the session, but it cannot be used, I should think, by the Minister of Finance as a basis of taxation at the present time. We must be logical. While it is true that people should not be penalized for having children, according to our present idea, nevertheless that is not the basis of taxation, and the Minister of Finance, I should think, has no discretion in the matter. While I am on my feet let me say that a moment's thought will show that if the mere multiplication of progeny had been the Creator's idea He would have arranged, as He does with the lower animals, that parents should have a dozen children a year.


Some hon. MEMBERS:: Oh, oh.


John Hampden Burnham: This idea of making a sort of market for produce for humanity is to me revolting. Statisticians like the French gentleman referred to by my hon. friend from Maisonneuve (Mr. Lemieux) all agree that no man can properly bring up more than a certain number of children.


Pius Michaud: How many?


An hon. MEMBER:: Eighteen.


John Hampden Burnham: It is said that some gentlemen like my hon. friend would be embarrassed with even one.


Georges Henri Boivin: Is the committee ready for the question?


Mr. MICHAEL CLARK (Red Deer):: I do not know that this is a discussion upon which we should waste very much time at this period of the session, and I feel very much hesitancy in even saying half a dozen words because I think the minister said all that was to be said on the question. The,e was very much force in his argument that the man who has the children is the blessed man. I think that as my hon. friend from West Calgary (Mr. Tweedie) is not present I may perhaps be permitted to quote Scripture to the extent of saying that "Blessed is the man who has his quiver full." The proposition contained in the amendment is also scriptural if it be right that,

"Unto him that hath shall be given"; but it would be a very free interpretation of that passage to say, that we shall remit the taxation of men who have large families and the blessedness that comes from large families. I quite agree with the minister that .a childless home is a frightful thing to contemplate. But I do not know thait my bon. friend from Maisonneuve (.Mr. Lemieux)-to whom one always listens with great interest-helped his argument by some of the statements he made with regard to what the Romans did. I am not disposed to draw many of my ideals in this twentieth century from mediaeval or primitive times. The Romans bad their day, and they went. They wanted large families for the purposes of militarism; and we have had enough of militarism not only in primitive and mediaeval times, but in times far more recent.
I was not very much impressed by my hon. friend's statement as to the passible growth of the French Canadian population in this country. It is a matter of comparative indifference to me what section of our population increases so long as we have laws which are equal and just between all our inhabitants, and which will make good citizens of them whatever may be their racial origin. But my hon. friend went on to say that there are 2,000,000 French Canadians in the United States. Now, in making his estimate of what the French Canadian population will be in the years immediately in front of us, he would also have to be able to predict how many of them will go to the United States. If the movement of the immediate future has any resemblance to that of the immediate past, then the effect of this amendment would be to exempt people from taxation to build up the population of the United States, and that would be a very serious proposition for me to give my assent to.
As a matter of fact I think the whole question can be summed up in this way: That the amendment fails to distinguish between a man's parental duties and his duties to the State. A man's parental duties are primary duties which he ought toi be proud and pleased to discharge, and the more he discharges them the better off he is in the possession of his children. But .a man's duties to the State are entirely different, and to say that he ought to be helped in his parental duties by being exempted from his State duties is a proposition to which I could not honestly give my assent. Our parental duties are, I think,
providentially imposed, and it is a primary duty to see that our sons become good men and our daughters good women as far as it iis in our parental power to bring that about. But our State duties are equally incumbent on us, and I certainly think the present exemption is sufficient.
Amendment (Mr. Archambault) negatived on division.


[Stage Direction]
Section agreed to.
On section 10-One-quarter tax to be forwarded with return; balance may be paid by instalments with interest, etc.
Henry Lumley Drayton: I desire to move an amendment to clause 10 in respect to the question which was brought up by the hon. member for Joliette (Mr. Denis). In the proposals that we are making we want the payment of this tax to be left in such a position that no tax-payer will run the slightest risk of loss by making an immediate return, but he will know absolutely that if he has paid too much he will get it back at once. Under the present law there is a provision for refunds provided in subsection 4 of section 10 in these words:
That the minister may refund any tax or penalty wrongfully or illegally assessed and collected, but no refund shall be allowed because of any alleged error in the assessment, unless application therefor is made within twelve months of the date of payment or penalty.
I do not propose to interfere with that subsection, which is quite enough to look after the situation generally; but in connection with the new provisions the position I think ought to be, that no one need make application -for a refund, hut rather that it is the duty of the department to properly check the assessment and the remittance, and if there has been an over-payment to remit the money without delay, instead of waiting until the individual-who probably would never find out that he has made an overpayment-sends in a claim for a refund. Therefore I propose to move the following amendment as a new paragraph, making it subsection 12:
The returns received by the minister shall be with all due -despatch checked and examined and in all cases where such examination discloses that an overpayment has been made by a taxpayer the minister shall make a refund of the amount so overpaid by such taxpayer except in cases wThere any instalment or instalments are either due or falling due by such taxpayer when the amount of the over-payment shall be applied on such instalment or instalments and notice of said action given such taxpayer accompanied by the payment of the balance if any of the amount overpaid.


[Stage Direction]
Amendment agreed to.
Mr. ROBB:: In view of the possibility that a person making out his income tax return might very innocently commit a mistake and come within the penalty clauses, which are rather drastic, I would like to know if the minister will make some provision whereby mistakes made in good faith may be generously dealt with by officials of the department.


Henry Lumley Drayton: The clause
really does not deal with the matter in the way that the hon. member thinks it does, although 1 quite understand his receiving that impression at 'the first glance. The taxpayer does two things; first, he shows what his income is. The amount of his income is something which the taxpayer ought to know; i't is something that the department does not know. The next thing the taxpayer is invited and has to do is to send in the amount of the assessment which he thinks ought to be made upon that income. As regards the making of the assessment, I entirely iagree with the hon. gentleman that this is open to error, and no penalty is provided far that. The penalty is not one which has to do with the amount of the assessment a man makes, because that may be full of errors; it has to do with the statement he makes as to his income which he himself alone knows about. Even as regards his income, if he makes a mistake of only 10 per cent, there is absolutely no penalty. Therefore, he is not asked to pay anything for any mistake which could in any way .arise from the construction of these statutes or from the imposition of conflicting or cumulative taxes. If ia man is honest in stating the amount of his income, there is no penalty. If he is dishonest and makes an improper return on a subject which he alone knows all about, he then (becomes liable to a penalty.


James Alexander Robb: The understanding is that if the person making out a return puts in correctly, or nearly so, his total income, he is not penalized for any deduction which he may make, and to which he imagines he is entitled. *


Henry Lumley Drayton: Not at all.


Mr. NICHOLSON (Algoma East):: Having that statement of the minister in mind, I should like to know how that harmonizes With the first paragraph of clause 14.


Henry Lumley Drayton: I will deal with clause 14 when we come to it. Clause 10 is intended to cover only the income.


Mr. ANDERSON:: Did I understand the minister to say that a man might make an

error of ten per cent in his income without being liaJble to any penalty?


Henry Lumley Drayton: Clause 10 at line 31 reads:
If the amount of the income omitted from his return exceeds ten per centum of the correct income.
That is the first 'time when you have any penalty in the nature of a fine imposed. The penalty there is one-half of the amount of the deficiency.


Mr. LOGGIE:: If the amount is less than ten per cent, 'he has to pay 10 per cent interest per annum?


Henry Lumley Drayton: Yes.


William Stewart Loggie: There is some penalty?


Henry Lumley Drayton: I do not look on that as a penalty.


[Stage Direction]
Section agreed to.
On section 11-demand for additional information.
Mr. DENIS:: I do not think this Bill provides for the examination of a person who owes the tax. I do no't know whether it would not be wise to insert such provision in the Bill, as such provisions exist in many statutes. For instance, the law 'in Quebec provides that where a person has in law a right to go into another person's business in order to find out if this person can or cannot pay a certain debt, -the law entitles the creditor to call and examine bis debtor. While I am not ready to say that 'a provision of this kind should be inserted in this Bill, it has been recognized through experience that the most proper, direct and satisfactory manner of knowing a man's business, is to examine him under oath.


Henry Lumley Drayton: The officers of the department are of the view that, up to 'the present time at any rate, they have not met .any difficulty which will require that to :be done. As much as possible, the endeavour is to collect the tax in an administrative way, with as little .recourse as possible to law and consequent legal expenses, and with as little harassment of the taxpayer .as possible. In connection with arriving at the amount of a tax, as long as it is quite clear that the department can get all the information they desire to geb-'and the hon. member will see that that provision is .added this year-and if in addition to that they can check the different sources of information, they can generally do just as well as if they .examined the man.


[Stage Direction]
Section agreed to.

On section 14-penalties for short payments or not making payments:
Henry Lumley Drayton: When we were considering clause 10 I had it in mind that it would be desirable to consider this clause in connection with it, because I did not want to have a penalty for a mistake in the assessment itself visited upon the taxpayer. But I find that this point has already been covered,-not in the first draft, but in the amendments made before the printing of the Bill. It- is provided that if the taxpayer does, not pay the amount, or one-quarter of it, estimated by him as the amount that he ought to pay, he is subject to penalty. Then, under section 14 he is again subject to penalty if he does not pay his taxes as provided by the new section, but he is not liable to penalty simply because the amount that he returns is subsequently found to be incorrect. The question of penalties, therefore, turns entirely upon the subject matter that the ratepayer himself knows all about,-the amount of his income and the amount that he himself says he should pay.


James Alexander Robb: As I read the section, the
taxpayer is penalized if he fails to make any payment at the time of his return. Suppose his understanding is that he owes nothing and that, accordingly, he makes no payment?


Henry Lumley Drayton: If his estimate shows no liability to tax, then there is no liability to penalty.


James Alexander Robb: He is liable to penalty
" should he fail to make any payment at the time of filing his return."


Henry Lumley Drayton: That means, of course, if there is any payment to make.


James Alexander Robb: It does not say so.


Henry Lumley Drayton: If the hon.
member thinks there is any doubt about that, there is no reason why it should not be_ amended. But there must be something to pay; if the taxpayer assesses nothing he is not liable to penalty under this section for non-payment.


Mr. FIELDING:: In this section the
words " the tax as estimated by him " are used, but there is no such expression in section 10.


Henry Lumley Drayton: The whole of
the work done under section 10 is done by the taxpayer. He makes the assessment, and when we come to the penalty we put in the words " as estimated by him " in order to make it absolutely clear that so long as 210
he pays his instalments as estimated by him he is subject to no penalty.


Mr. CHAPLIN:: Is any provision made to cover the case of a man who is out of the country and cannot take care of any of these notices, within the required time?


Henry Lumley Drayton: We do not extend the time in individual cases. It is the business of taxpayers who are away for any considerable length of time to have some one look after their returns. But the time is sometimes generally extended; we did this year extend it for a period of one month. There is a provision that the minister may at any time enlarge the time for making an individual return, but we try to get along without any individual extensions of time.


Jacques Bureau: (Subsection (2) of section 10 provides that if the minister suspects that the taxpayer is about to leave Canada he may, " for that or any other reason," by registered letter to the taxpayer, demand payment of all taxes within ten days. If the minister were looking after these things personally I would not have any fear concerning them; but matters of this kind are left to his officers in. the various localities. It may be well to take such action if a man is leaving the country, but it seems to me that the use of the words " for that or any other reason " makes, the provision a rather drastic one.


Henry Lumley Drayton: It is drastic,
but not as drastic as the similar provision in England, where the length of time within which payment must be made in such [DOT]circumstances is five days, I believe. It is essential that the public revenues should be protected. So far as administration is concerned, this action cannot be taken by an ordinary officer. The matter would be the subject of report to the head office, and action could be taken only by the minister or by the Commissioner of Taxation.


Jacques Bureau: On the report of the officer; it is the same thing.


Henry Lumley Drayton: Oh no; I assure the hon. member that the commissioner is not merely a rubber stamp. Moreover, to what country would a man go in order to avoid the tax? I do not think he would go to Great Britain, where he would find conditions worse. I do not think he would go to the United States where, as I am instructed, they have precisely the same provision.


Mr. JACOBS:: Subsection (2) provides
that:



Non-payment of the said tax within the specified time shall render the goods of the taxpayer liable to seizure by the sheriff of the city, county or district in which the goods of the taxpayer are situate.
Is it the desire of the minister, by this Bill 158, to amend Magna Chart.a, which says that no citizen can be dispossessed of his property without due process of law?


Henry Lumley Drayton: Does the hon. member not think that this statute is "due process of law"?


Samuel William Jacobs: The seizure of a man's
effects without giving him opportunity of placing his case before the court would be due process of law if that law were Lynch law as applied in remote portions of Mexico, or, perhaps, in distant parts of Texas.


Henry Lumley Drayton: I am afraid
that I cannot follow the hon. member to Mexico.


[Stage Direction]
Section agreed to.
On section 16-retroactive effect of sections of this Act.
William Stevens Fielding: I suppose the object
is to enable the minister to recover the sums of past years; but |I understand that he does not intend to apply the penalties for the delays.


Henry Lumley Drayton: That is correct. We have had some clauses which entirely interpreted what the law was. So far as the new clauses are concerned, those that we have been discussing recently as [DOT]to the assessment being made by the individual himself, and the penalties provided for, these do not come into effect this year.


Mr. OOCKSHUTT:: I desire to ask the
minister ia question in regard to the returns called for in this section.


An hon. MEMBER:: Which section?


William Foster Cockshutt: This refers to three or four of the sections that come into force at ia certain date. There are many companies whose year terminates on December 31st. A company's year ended, say, on December 31, 1919; the dividends were earned in that year's business, but the annual meeting land the declaration of the dividend do not take place until the books are all audited and the accounts are in for that year. The result is that it is perhaps six or eight weeks after the end of the fiscal year before the dividend is declared. I had a slight argument with one of the collectors in that connection recently, and it

appears to me that it is impossible to estimate the dividend before it is declared, even though it may have been earned. What is the ruling of the department on that point? Is At the intention that the dividend shall be charged to the year in which it is paid or the year in which it is earned?


Henry Lumley Drayton: The point is
perfectly well taken. We have cleared up any doubt in the matter by section 3 of the present Bill, which reads:
Dividends declared.shall be taxable income of the taxpayer in the year in which they are declared or voted.


William Stevens Fielding: Take the case which
my hon. friend from Brantford has mentioned. The year may close on December 31st and the accounts are made up at a later stage, and as a matter of fact the dividends are only collected in the following year. Would they not he part of the income of the shareholder in that year?


Henry Lumley Drayton: The dividends
are only declared when the accounts are made up and when the meeting is held.


William Stevens Fielding: The declaration of the
dividend does not create an income; it is the payment of the dividend that makes the income. If my hon. friend is going to take the declaration and not the payment of the dividend I think he will encounter some embarrassment. The income is what the man receives, and the year in which he receives it should he the proper accounting period into which it should enter.


Henry Lumley Drayton: I confess I
thought that the trouble really was that companies having earned their dividends were not in a position to bring their hooks down and declare those dividends within the accounting period. I think that the tax ought to be paid, as closely as possible, upon money when it is earned. The dividend is an accretion to the taxpayer during the year it is declared.


William Stevens Fielding: No. .


Mr. COPP:: It may he declared payable
in so many months' time.


William Foster Cockshutt: There is no doubt
that dividends are frequently declared months before they are paid. I am aware of a recent case in which it was four months after the declaration of the dividend before anything was actually received. It is the .time between the declaration and the payment that may cause all the trouble.

Many companies do declare dividends far in advance of actual payment, and sometimes the dividends are not paid in cash but by stock. I knorw of a case where dividends were paid in fully paid-up stock, because there was not the actual cash.


William Stevens Fielding: The minister has dealt with thait point.


William Foster Cockshutt: Stock might not be received until some time after the dividend is declared. I am sorry I was not here when clause 3 was adopted, but it seems to me thait we should have a clear understanding as to whether a stock dividend, which is not money at all, is treated exactly as a cash dividend.


William Stevens Fielding: The minister dealt
with the question of stock dividends yesterday, iand the hon. gentleman's point has been covered. I am afraid, however, that the minister's view that a dividend earned is to be credited up to one's income when it is declared may be embarrassing. Suppose a man is engaged at a salary of $5,000 a year and through some mishap he does not receive that amount. He has earned it, but in the settling up of affairs it is found that something has gone wrong and be does not get .that money. Would you tax that as his income? It is the same thing with dividends. A dividend is only an income when a man gets it, I would ask my hon. friend to give some consideration to that point because he may find it a difficult one.


Mr. BELAND:: There is a further point. A shareholder may cease to be such between the time the dividend is declared by the board of directors and the date at which it is paid. A meeting might take place in December and the directors might declare a dividend payable on the first of February to all shareholders on record on the 15th of January. In the meantime, between the date of the meeting and the 15th of January the shareholder might, if he chose, dispose of his shares, and in that case I do not see that he should 'be taxable so far as those shares are concerned.


William Stevens Fielding: He would get the benefit of the disposal of the shares.


Henry Lumley Drayton: Yes.


Henri Sévérin Béland: He might dispose of the
money in such a way that it would bring him no immediate return. He might invest it in some enterprise which might not he profitable at all.


Henry Lumley Drayton: I would like to leave it entirely to the committee. It is a 'question whether the ratepayer should he relieved or not. What we have proposed is entirely in easement of the ratepayer. We have thought it fairer no-t to accumulate dividends. There are cases where dividends are paid that represent dividends for a series of years. A company has been in *such a position that the money cannot be taken from it. The effect of this provision is to prevent a larger penalty being imposed on the shareholders. We have not sought to tax the shareholder on money that he has not actually received. Apart from this clause perhaps three or four years' income would he received in the one year.


William Stevens Fielding: Then it surely would
come in the return for the next year if he actually received- it?


Henry Lumley Drayton: No. Take the case of a company that are in the position of not 'being able to distribute earnings for three years. They had been making earnings each year, hut they were not distributing them because they were required to keep the money in the business. Under this section, when the payment was made, the department would distribute those dividends over toi the proper years when declared, although not paid because they could not *afford to pay them. Apart from that section, when the money was received by the taxpayer, it would be part of his taxable income for that one year, and it would put him in the higher brackets as far as taxation is concerned. It may be that it is '.quite unfair that he should be put in the higher brackets because he has been at a loss in the other years. It would be unfair to place him in the higher 'brackets and the income should be considered as taxable in the year in which the dividend was declared though not paid.


William Stevens Fielding: I could understand that if you were dealing with the business profits tax there might be something to be said in support of the proposition, because you are dealing with the operations of a company for a given year. But surely on a *question of dividends there is no room for debate that a man's income is that which he receives. If it is not collected, it remains to his credit and it may he paid to him next year. Suppose I were a shareholder in a company and- I did not collect *my dividend in a given year; I would get it next year, and if I were an honest man I would account for it next year. Surely income is that which a man receives, and if

he does not get it in a certain year, there is no income.


Henry Lumley Drayton: I have no feeling one way or the other. It means more money for the department to accept this suggestion and we want to get all the money we can.
If I can secure unanimous consent, I desire to move that the committee return to the consideration of clause 3, which has been agreed to.


[Stage Direction]
Motion agreed to.
Henry Lumley Drayton: I heg to move to amend clause 3 by striking out the last three words of the said clause and substituting therefor the following words: "paid or distributed."


William Stevens Fielding: Will my hon. friend
need this section at all? It seems to be specially designed to apply to income of the year that has passed. It appears to me that this clause is not necessary.


Henry Lumley Drayton: This is to make it clear.


William Foster Cockshutt: I think the suggestion of the minister would cover the point I desire to draw attention to. I have known dividends to be declared that were not paid and were not allowed to be paid by the bank. The financial position of the company was such that the bank thought it was not desirable to withdraw the money, and therefore the dividends were not paid. That is the reason why the minister has thought it right to clear up that point, and it appears to me that the words he has suggested cover the case. I think it is quite proper that they should be inserted.


Mr. PEDLOW:: Would it not be well to *use the words "in that accounting period" instead of "in that year" in the last line of subsection 5?


Henry Lumley Drayton: That would
not do.


Isaac Ellis Pedlow: In connection with the sessional indemnity the accounting period of members of the House who are in business falls, say, in the first or second month rather than at the end of the month of December. This accounting period would run through each day until the 31st January, thus overlapping two years. The rule of the department is that the sessional indemnity should be included in the return for the year in which the return i^ made, but the indemnity has not yet been received , by the taxpayer. In that case it is a hardship, -because a member might send in a
JMr. Fielding.]
return of his taxable income to the 31st January and it might include his prospective sessional indemnity which he might never receive.


Henry Lumley Drayton: I think that by far the greater number of cases are better served as we have it now. There are not many returns made in advance.


Henri Sévérin Béland: I understand that the
Canadian Pacific and the Government have come to an agreement as to a flat rate that is being paid- by the company to the Government yearly, and that it accounts for all the taxes that should be paid by the shareholders of the company as income taxes. Does that agreement apply to other companies?


Henry Lumley Drayton: There is no
agreement. The Canadian Pacific pays on the basis of the statute.


Henri Sévérin Béland: I understand the company pay $6,000,000 a year to the Government, is that correct?


Henry Lumley Drayton: No.


Isaac Ellis Pedlow: I am sorry the minister failed to comprehend the force of my argument. To put the case in another way, take the situation last year; a man in business whose accounting period ended January 31 made up a statement for that accounting period and he included in his return his prospective indemnity of $2,500. But during that year there -were two indemnities. Would he be penalized under this new Act for the omission of the two indemnities?


Henry Lumley Drayton: No.


Isaac Ellis Pedlow: He received $5,000 for the year, but he could only know of one indemnity; consequently he would only include one indemnity in the return; therefore he would be sending in an- incorrect return.


Henry Lumley Drayton: If a member makes up his return in advance in connection with his indemnity that, of course, is something we cannot object to because we want to examine returns that come in as quickly as possible. But the Act does not require him to. All the Act requires to be done is a return to be made on the income during the past year. He is not to take into consideration anything that may accrue to him in the future during any portion of the year in which he is making his return. You do have a little difficulty, though, in partnerships and mercantile businesses where

the accounting periods differ, and there is an express provision of-the Act dealing with that one particular thing:
A member of a partnership or the proprietor of a business whose fiscal year is other than the calendar year shall make a return of his income from the business, for the fiscal year ending within the calendar year for which the return is being made, but his return of income derived from sources other than his business shall be made for the calendar year.


Isaac Ellis Pedlow: This Bill leaves the matter in an indefinite shape. The person whose accounting period is not in line with . the calendar year, is in the position if he has an indefinite income from another source, that he cannot include that in his return for the accounting period. I know that the department has rules-it has ruled in my own case-that the amount of the prospective indemnity must be included in the return for the year. Now it is impossible for men in the retail business to balance up their books for the year by December 31, and so come in complete alignment with the calendar year. Consequently they balance up their affairs on January 31 or February 31, as the case may be. Nevertheless they are required by the department to do as I have stated. From my own personal experience that has been insisted on.


Mr. SHEARD:: Will the hon. gentleman allow me to ksk him a question. He spoke of February 31; I would like to know to what year he refers?


Isaac Ellis Pedlow: 1 meant to say January 31, or the last day of February.


Charles Sheard: That is putting it correctly.


Isaac Ellis Pedlow: I thank the hon. member for correction, but my argument is not influenced by it to any great extent, the point is quite clear. I think there should be a definite ruling on the point even though the case may be an exceptional one. When a member of Parliament is required to include all his prospective income in his return there may be a thousand and one reasons which will militate against his receiving that income. For instance death might occur or Parliament might be dissolved. We know for example that in 1919 there were two sessions in the year. A member might include only his indemnity for the one session and then would be subject to a penalty, under the statute, for sending in.a false return.


Henry Lumley Drayton: Of course generally all these taxation matters are expressed with more or less difficulty, and I
admit that the subject is intricate to a greater or less extent. I think, however, that it is quite clear, from the section I have just read, what the real situation is. At any rate it has worked out very well in , other countries where it has been in force for a good many years. Now let us be quite clear as to how matters stand. In the first instance, what is called for, ordinarily, is a return of income received during the year that is past.


Isaac Ellis Pedlow: The accounting period.


Henry Lumley Drayton: Not the accounting period. Let us forget that for a moment. Under ordinary circumstances the return calls for* the income received during the year that has passed, the preceding year. Now then as to where you have a broken accounting period. Take for example,the case of a business whose accounting period ends on January 31, as the hon. gentleman pointed out. In the case of such a business it would be the duty of the manager of that business, in making his return, to include in it the actual receipts or the actual income of that business down to the 31st of January. Take for example this year: the ordinary taxpayer gives the whole of his income up to the end of 1919 in his return, and he makes that return in 1920. The manager of the business of the class I am referring to, instead of making a return for 1919 only, would base . his return on the accounting period which ended the 31st January, 1920.
I beg pardon, the Commissioner of Taxation tells me that I am wrong, too. I think that should be the case, myself, but I am told that the department, instead of doing that, go further in ease of the hon. gentleman than I would. All that you need do, according to what the commissioner says, is to make a return as of the 31st January, 1919.
I think it should be the 31st January 1920, but apparently that is not the fact. Instead of having to make a return in advance, instead of running the danger of being fined,-as the hon. gentleman is pointing out-for an error in connection with something that may happen in the future, you are apparently allowed to go back as far as the 31st January of the year previous. The section apparently is quite clear, and the commissioner is right, for it says:
-whose fiscal year is other than the calendar year shall make a return of his income from the business for the fiscal period ending within the calendar year for which the return is being made.
Now that ends in 1919.


Isaac Ellis Pedlow: And what about anything outside of that?

ISir HENRY DRAYTON: As to anything outside of the business he is in exactly the same position as any other taxpayer, he would have to pay on exactly what he received during the year.
Mr. PED'DOW: I still submit that it is confusing in connection with the accounting of any business to require any person in business to make two returns-one return for his business accounting period ending January 31 each year, and another return' for income received outside that business. Take a specific illustration, my own case. My accounting period ends January 31 each year. I was compelled to send in a return for 191$, and I was also compelled to send in another Te'turn and include in the accounting period which ended January 31, 1919, my income of which the sessional indemnity formed part. The department insists upon that. My contention is that only what a man actually receives from all sources in the accounting period should be included. That is my argument.


William Foster Cockshutt: It appears to me that my hon. friend is contending about a point that is very clear in so far as the Government is concerned. The accounting period that the Government sets ends on the 31st December in each and every year. If the hon. gentleman's accounting period is January 31, he does not make the return for that year at all. The hon. gentleman will have the privilege of holding on to the funds for eleven months if his accounting period. is. the 31st January; but he must make his return for all the money he has received up to the 31st December. Suppose the Parliamentary session were on and he had received the indemnity for November and December he would have to make a return of that in his statement for the year. If the Parliamentary session were on and he received part of his indemnity for, say, November and December, he would have to make that in his return, but his indemnity for January, February, and March would appear in his statement for that year; in other words, he would split his indemnity into two parts. The same prinicple would be followed in regard to any other income, and anything received on the 2nd of January, although belonging to the p>evious year, would be included in the next year's return. I fought that out with the inspector, and it was ruled finally that my returns were correct because I included all moneys received up to the 31st of December.


Isaac Ellis Pedlow: There is no ground for misunderstanding in that statement of the

situation. But you do not understand the position I am placing before the House. Your accounting period ends on December 31, therefore-


Georges Henri Boivin: Order. The hon. member should address his remarks to the Ohair.


Isaac Ellis Pedlow: I apologize, Mr. Chairman. My hon. .friend is certainly in error in thinking that the two cases are parallel; they are altogether different; and that is where the difficulty occurs. There are many men in business whose accounting period, does not end on December 31, and if placed in the position which I myself and many others are in, they will find a difficulty in complying with the ruling of the department. The department has ruled that it is necessary to include in the returns all that might be anticipated. I have had to fight out with the department.


Henry Lumley Drayton: If that is the only trouble, Mr. Chairman, I have much pleasure in assuring the hon. gentleman that it will not occur again. No taxpayer is called upon to anticipate anything in his return.


Jacques Bureau: Except his bill.


Henry Lumley Drayton: It was a mistake made by the department.


Isaac Ellis Pedlow: I am very glad to have that definite assurance from the minister, which settles my difficulty for all time to come. I can assure the hon. member for Coekshutt-


Jacques Bureau: Hear, hear.


Isaac Ellis Pedlow: I mean the hon. member for Brantford-	[DOT]


Jacques Bureau: The hon. member for the Six Nations.


Isaac Ellis Pedlow: -that it is not with the object of hanging on to the money for eleven months longer than I am entitled to that I raised the question; it is merely to have it squared away.


[Stage Direction]
Amendment agreed to.
Clause as amended agreed to.
On clause 4-income from an estate or accumulating in trust.
William Stevens Fielding: My hon. friend (Sir Henry Drayton) made a motion to amend this section by substituting-


Henry Lumley Drayton: By substituting the words "paid or distributed"
4 p.m. for the words "declared or voted."


Jacques Bureau: Why was this clause held back; what was the trouble.


Henry Lumley Drayton: It was held back because one hon. gentleman said the effect of the clause was to get something paid by some one who never benefited. It is quite clear that his anxiety was not well founded, 'because it is a tax against income in the hands of trustees and not in the hands of beneficiaries. What the section does is to cover accretions of income although not distributed.


Mr. DEVLIN:: But the beneficiary must pay the tax as well as the fiduciary.


Henry Lumley Drayton: The hon. gentleman is quite right, if the income is distributed; but all we are dealing with here, Mr. Chairman, is undistributed income.


[Stage Direction]
Section agreed to.
Mr. CASGRAIN:: Before the Bill goes out of committee, Mr. Chairman-


Georges Henri Boivin: Order. There is still clause 5 to be carried.
On clause 5-Patriotic and Red Cross funds.


Henry Lumley Drayton: That is a clause in which the hon. member for London (Mr. Cronyn) is very much interested. As he is attending a committee of the House this afternoon, I do not think it would be fair that the clause should be considered in his absence. That is the only clause left for consideration.


Georges Henri Boivin: The Bill might be reported and the clause struck out on the third reading.
Mr. OOOKiSHUTT: Clause 16 has not yet been adopted, has it?


William Stevens Fielding: It was left with the understanding that the minister and the hon. member for London might be able to agree upon an amendment. I presume that has not yet been accomplished?


Henry Lumley Drayton: No.
jMr. FIELDING: It is not because they have differed; they have not had time to attend to it?


Henry Lumley Drayton: He has made further suggestions which I have not yet had time to consider.


Mr. MIDDLEBRO:: The hon. member for London (Mr. Cronyn) will be here in a few' minutes.


Henry Lumley Drayton: The clause suggested by the hon. member for London is different to the clause which he submitted yesterday. I will ask the committee to bear with me while I place my hand on the suggested amendment.


Georges Henri Boivin: While we are waiting, the hon. member for Charlevoix-Montmor-ency (Mr. Gasgrain) might take advantage oif the opportunity to place his views before the committee.


Joseph Philippe Baby Casgrain: 1 would like to draw the attention of the Minister of Finance to a certain matter which the hon. member for Ohambly-Vercheres (Mr. Archambault) and myself referred to in the Budget debate; the taxing of earned and unearned incomes. At present under our law there is no difference in taxation depending on where the income comes from. In England I am told a distinction is drawn between incomes derived from real estate and securities and those which are earned and are absolutely extinguished on the death of the person earning them. For instance, a professional man as the manager or director of a big institution might take fifteen or twenty years to work up to an income of $15,000 or $20,000, which will immediately stop on his death, wdiereas the income from investments or real estate does not cease on the death of the owner, but inures to the benefit of the family. Has the minister considered the suggestion of distinguishing between the rates of taxation on earned and unearned incomes?	_


Henry Lumley Drayton: I took the question up some time ago when I first started to consider the income tax. I may say that my first impression was the same as the hon. gentleman's.. A distinction is drawm in some countries. It is not drawn in the United States, nor in Australia nor in New Zealand as I recollect. It is drawn in part in Great Britain. There the income in the smaller amounts are distinguished, and the result is that income from investments is subject to a somewhat higher tax than other income, but the difference is not very great. The manner in which it applies in Great Britain is not exactly as I think the hon. gentleman would expect, because while it applies to the small, i. does not apply to the large investor. For some reason, probably having rega-d


Joseph Philippe Baby Casgrain: In view of the fact that it is not certain at present whether there is going to be any increase in the indemnity of members of Parliament or not, I should like to know if the Government has considered the matter of exempting the indemnities of members from taxation.


Henri Sévérin Béland: That matter was discussed yesterday.


Joseph Philippe Baby Casgrain: It was left in abeyance.


Mr. REID (Mackenzie):: What is the
maximum exemption in Great Britain?


Henry Lumley Drayton: 
Michael Clark: 
Henry Lumley Drayton: 
Joseph Philippe Baby Casgrain: Has the minister any information to give us regarding the exemption from taxation of indemnities of members?


Jacques Bureau: I thought it was suggested that members should be allowed to deduct a per diem allowance to cover their expenses? An amendment would be necessary to the clause which says that the indemnity shall be taxable.


Henry Lumley Drayton: The matter is one which I hoped ta be able to look after in administration of the department; but I find this addition was made, I think, in the Senate, to one of the Bills:
In determining the income, no deduction shall be allowed in respect of personal living expenses, and in cases in which personal and living expenses form part of the gain, profit or remuneration of the taxpayer, the same shall be assessed as income for the purposes of this Act.
My personal view, as I frankly told the committee, was that, as members have to be something out of pocket in order to earn the indemnity and as this is intended as an indemnity, not as a salary, if it be an indemnity, a fair per diem allowance for expenses for the time hon. gentlemen are in Ottawa engaged in their parliamentary duties, ought to be given.


Jacques Bureau: All right.


Rodolphe Lemieux: In order to be fair to the minister, I should like to say that the question of the indemnity was brought up a year or so ago in a moment of hysterics. The word "indemnity" itself suggests ths idea that it has for object the recouping of expenses made in order to perform a certain duty. As my hon. friend very well said a moment ago, it is not a salary; it is not a fixed income; therefore it is mot a revenue, and should not be taxed. But if it be so taxed, if we are such super-patriots that we must super-tax even our indemnity, then let us make an allowance far the expenses we have to incur in order to attend to our duties at Ottawa. There should be no false pride in the matter.


Joseph Philippe Baby Casgrain: I should like to have a definite ruling from the minister on this point.


Henry Lumley Drayton: I am afraid I cannot do anything more than quote the law as it now stands. This is a matter that could be dealt with only by an amendment.


Joseph Philippe Baby Casgrain: So far, the department has asked that we pay on the amount of our indemnity, and we are not given any allowance or credit for the expenses we incur at Ottawa. 'If it be the intention of the minister to interpret the law in the way he suggests, we should have a decision of the matter now and an amendment inserted in the Bill.


Rodolphe Lemieux: The minister does not interpret the law. He is not the author; he regrets it.


Jacques Bureau: Now is the time for an amendment.


William Foster Cockshutt: If the minister is able to give a decision, it is proper that it should be given now. I quite agree with my hon. friend across the way that an indemnity surely cannot be called such until the expenses incurred in connection with receiving it have been met. That takes, according to a man's spending power, anywhere from 25 to 50 per cent, sometimes 75 or 100 per cent. Therefore, a fair average might be struck, and I believe the minister is disposed to do that. But he says that the clause which he read does not leave any option in the matter. Without wishing to embarrass the minister at the moment, if this requires amendment-and I want to back him in this-I think if a modus operandi can be reached whereby la certain exemption may- be made from the amount of the indemnity to cover what is spent by members while in Ottawa and while coming to and from Ottawa with all the other accessories in connection with our attendance here, that would be only a fair amount. I am not arguing for this for myself, because I can do without it, but I know that this tax is oppressing many members, and inasmuch as it is oppressing many members, it is a fair matter for consideration. I believe the intention in the first place was that the contention of my hon. friends across the way was to be the rule observed, and that the tax would fall only on such portion of the indemnity as we actually receive in hand after the work of the session was over. If a decision were *arrived at in the matter, that would be very desirable.


Henry Lumley Drayton: I would suggest that the consideration of this matter be left open until the third reading, when I will undertake to bring the matter up and advise horn, gentlemen what it is open to me to do under the circumstances.


[Stage Direction]
Section agreed to.
On section 5-Patriotic and Red Cross funds.
Mr. CRONYN:: Following the suggestion of my hon. friend (Mr. Fielding) I endeavoured to draft a new paragraph (c) of subsection (1) of section 3, which I submitted yesterday to the minister. I am not aware whether it has received his approval, but I would like to read it. The effect is to amend clause 5 by adding thereto the following words:
and the following substituted therefor:-
Subject to such regulations as may be made by the minister, amounts paid by the taxpayer during the year to corporations organized and operated exclusively for hospitals, orphan *asjylums, and other charitable purposes, no part of the net earnings of which enures to the benefit of any private stockholder or individual, to an amount not in excess of ten per cent of the taxpayer's net income, as computed without any deduction being made therefrom under the provisions of this paragraph.
I would ask for leave to withdraw the amendment which I previously submitted and to move this one instead.
Previous amendment withdrawn.


William Foster Cockshutt: Hon. members have long been accustomed to make contributions to good causes, in their own constituencies at least, and they should not be denied that privilege by reason of the operation of the income tax. But if a very large portion of our income is taken from us by taxation we may be denied the privilege of mak'ng charitable donations to various good causes. The intention of the Government, is, I am sure, not to prohibit contributions to charity on the part of hon. members or citizens generally who are charitably inclined, and the minister would be well advised to accept this amendment or a similar one-I am not tied to the words; I have it just now for the first time. The amount of income which may be so contributed has been set in the amendment at 10 per cent. That is a modest amount, because many persons give more than 10 per cent of their income to charitable causes. The effect of tins amendment would be to enable citizens to continue their contributions to certain well-established charitable institutions in their own immediate neighbourhood. I personally have for many years taken a considerable interest in an orphanage. I shall not be able to continue to assist in that work if my income is considerably depleted by taxation, and these charitable institutions will suffer. The people generally should be encouraged rather than discouraged in this connection. There is no doubt that charity covers a multitude of sins.

Charity makes the giver feel better and happier. No money is better spent than that which is contributed to a good cause, the welfare of which the donor has at heart.
I have much pleasure in seconding the motion.


William Cameron Edwards: I appreciate the motive of my hon. friend (Mr. Cockshutt) in his advocacy of the amendment when he points out that charity covers a multitude of sins. His argument seems to amount to this: that those who are in a position to contribute to this or that institution shall exercise their judgment as to whether they shall give to that institution or whether they shall contribute by way of taxation to the revenue of the country. For my part, I do not think that any person should be allowed to deduct from his income that which he gives to charity or to any charitable institution and thus escape taxation on that amount. I hold that view just as strongly as some hon. gentlemen hold the other view. Certain taxes have to be raised in this country. Let those gentlemen who are blessed with considerable wealth and who are sensible of the enormity of their sins and transgressions, after paying their taxes, cover up the multitude of their sins by contributing to charitable purposes to such extent as they feel disposed.


Mr. NESBITT:: The assisting of charitable institutions is not by any means confined to people of wealth. Charitable institutions may be generously assisted by wealthy persons, but as a rule they are largely maintained by persons of very moderate means, -maintained because it is absolutely necessary that they should be maintained.


Jacques Bureau: Persons of small means and big hearts.


Edward Walter Nesbitt: Quite so. I do not think we should be carried away with the idea that these institutions are entirely maintained by the rich. If charitable institutions are properly defined in the amendment I think it would be a good thing to allow amounts so contributed to be deducted from the net income for the purposes of taxation.


William Stevens Fielding: I am heartily in sympathy with the purpose of the amendment of my hon. friend (Mr. Cronyn), though I wonder whether he is wise in specifying hospitals and orphan asylums; whether a reference to charities generally would not be sufficient. Then, the minister is to make regulations; I assume that they would define what these charities should be.

In connection with the War Charities Act the Government had to accept the responsibility of determining what were war charities and what were not, so that the duty on the part of the Government of arriving at such a decision is not absolutely new. However, in its general purpose I cordially support the amendment of the hon. member for London.


Michael Clark: On this occasion I am absolutely in agreement with my hon. friend frt n Frontenac (Mr. Edwards). Charity, to be worthy of commendation either in this world or in the other, ought to hurt the person giving it. If the State is to see that a man is carefully protected in connection with what he gives away, I cann'ot see where the charity comes in. A case of giving was discussed on one occasion by the Highest Authority. We were told that the rich out of their abundance gave, and they did not seem to receive much commendation. Then a widow came along who had only two mites; these two she gave and she was the one who received the praise. In order to make that gift she had to hurt herself; she had to scimp. I do not put myself up as a man who does it, but I do not want to talk buncombe or 'to listen to buncombe. I repeat that in my view the only charity that is worthy of commendation is charity that hurts. If it does not hurt it is not charity; it is that which is described, as I have just said, by the Highest Authority as giving out of our abundance.
I should be sorry to describe as charity on my part anything that was carefully protected from being taxed by the State. We are living in a period when we should realize something of what the world has been going through. We must be prepared as civilians to emulate to some extent the sacrifices of those who have given to the tune of 60,000 men all that they possessed and were-themselves. That is my view of the question and if it comes to a vote I shall have to take the same course as my hon. friend from Frontenac.


Mr. HALLADAY:: This gives a loophole
to some people who may not desire to pay their taxes. Some man might claim exemption on the strength of contributions, real or alleged, to the Red Cross or the Patriotic Fund or some other charitable institution. I am afraid that there are many people in Canada who would be ready to seek exemption and press their claim, because they had contributed to such funds as these.


Mr. RICHARDSON:: My view is that if you adopt the amendment the taxpayer will be given the option of contributing to the State or contributing to charitable institutions. If the contributions could be limited in the future to the same proportion as existed in the past there might be some safety valve; but with my knowledge of human nature I think there would be a grave danger, if the amendment were adopted, that thousands of people, influenced by the idea of making themselves solid for the future might be disposed to cheat the State of their legitimate contributions to the public revenue.


Mr. SCOTT:: In discussing this matter I see no reason why we should confuse the question of taxation with matters of charity. When it comes to paying other taxes than this particular one there is no consideration of charity. Why, therefore, should we make any distinction between the payment of income tax and municipal, provincial or any other taxes? When we are called upon to pay our municipal or provincial taxes we do not introduce the question of charity as a plea for exemption, and whatever we'may see fit to give to charity has nothing to do with our duty so far as the payment of taxes is concerned. For my part, I see no reason at all why charity should be brought into this discussion, and I feel I must vote against the amendment.


Mr. WILSON (Saskatoon):: I have had
a good deal to do in soliciting subscriptions for onq.good cause and another in the country whenever charitable and benevolent institutions were being promoted or aided, and my experience has shown me that after 'all the bulk of assistance comes from those people whose income is exempt from taxation for the reason that it is small and barely sufficient for their needs. It is from such people that, to a great extent, contributions come for the upkeep of Churches, charitaible institutions, and other organizations that are supported by philanthropy ; and if you grant this exemption to men whose income is large, you will be met with this argument, by those whose income is exempt from taxation:	"John
Jones has a larger income than mine and he is exempt on his charity, while I am not because I am exempt from income taxation." That is the argument that will be put forward by those whose income is below the exemption limit, and I think it would be unwise to accept this amendment.	,


Henry Lumley Drayton: I have a great deal of sympathy with the objects of the hon. member for London (Mr.' Cronyn), but so far I have been unaible to see my way to accept the amendment. I look upon the matter, however, as one entirely for the committee, in whose hands I think it can safely be left. I do not desire to add anything except to make ,an observation or Itwo. I want to be absolutely fair about the matter. It is not a question of the ratepayer electing whether he will contribute to the country or to charity, because the exemption is on the amount of taxable income, and no matter what a man may give to charity ,we exact taxation on his income which varies from 4 per cent, 6 per cent, 8 per cent up to 34 and 56 per cent in the higher registers. My objections to the amendment still stand. I am afraid of difficulty arising, not from charitable persons but from the man who does not like to pay taxes; >and I do not think that in the majority of instances, or indeed in any instance, charity would derive any great assistance from a man of that class. We have all kinds of returns made and there is a great deal of checking that has to be done. Unfortunately, there are people who think it perfectly right to cheat in their income returns, just as there are those who cheat in passing the customs barrier, and if he adopted the motion we would only be giving further scope to such people. In the second place, I (think we require all the revenue which we can derive.


William Stevens Fielding: I think it is a mistake to treat this as a question of exempting the individual. It is not a question of favouring the individual; the question is not, why .this man should be exempt and another man not exempt. The real question is whether we are going to do something helpful or something injurious to the charitable institutions of the country. That, in my opinion, ,is the correct view of the question. We have not yet in Canada reached socialism, communism, nationalism or any of the other numerous " isms" that exist to-day. We still do a thousand and one things 'by individual effort in this country. There is a vast amount of good done in Canada every day through individual 'action. A great 'deal of charitable work is not done by'governments, either provincial, municipal or dominion, hut by individual effort on the part of the people; and unless we can encourage this individual effort, the charitable institutions of the country

may suffer. I do not think it is worth while discussing the interests of the individual. We should not look upon the question as one of individual exemption,.but we should certainly ask ourselves this question: Are we or are we not going to help those institutions ;which are doing so much good in the country? If the effect of the new taxation is to put a check on the outcome of generosity on the part of the people towards these institutions, then that is>
a fact well worthy of consideration. I am not pleading for the individual but I am saying a word for the thousand and one institutions throughout Canada which I think ought to ibe encouraged and which might probably be affected by this proposed taxation.


Mr. McGIBBON (Muskoka):: I hope for the good of the country that this amendment will foe voted down. After all, it boils itself down to this: This is a request from the wealth of this country to be exempted from taxation. I have nothing to say against them or what they have done but I want to say that some 400,000 or 500,000 men served for a good many years at a very low price and they .are not coming here asking to foe exempt from taxation. If the wealth of this country is going to fall down unless a certain amount 'is deducted from their taxation and if they are going to withhold their contributions to charitable institutions, so much the (worse for the wealth of Canada. I do not believe they will do that, I do not believe they will ask for exemption and I do not believe the members of this House should exempt wealth when they are not exempting those who served the country at the front.


Hume Cronyn: There are just one or two questions raised that I would like to make clear in regard to the wording of the amendment. It says: "Subject to such regulations as may be made by the minister." That is a phrase very commonly used in other taxation measures. In my mind it seemed that under that phrase the minister could make a regulation, for instance, that in the case of any gift to charity the receipt for that contribution must be attached to the return of the income so that there might be no possible question of fraud, as has been suggested. The addition of the iwoTds ' "hospitals, orphan asylums and other charitable purposes" is due ito the suggestion of the parliamentary counsel that hy using the introductory words you practically define iwhat charitable institutions are under the well known legal rule. The 
minister then would have a definite line to determine what were and iwhat were not charitable institutions. I believe that since the war among people of moderate incomes the practice of "giving till it hurts" has prevailed. I know that in our own city we had this year a general campaign for all charitable purposes and it was a pleasure to note that the man of medium income was giving in proportion far more than the wealthy man. .Some of these men, in discussing at the time their subscriptions said: "We look alt our budget carefully; we know what we have and what we can spare for purposes of this kind; this one campaign is to cover everything for this year; we are going to give every dollar we can but if we are called upon in addition to pay a tax on this subscription we must either deduct that tax from our subscription or we must cut off something else." Of course it may foe said that it would foe a fine thing to deny yourself some other need of living. I do think, however, that an amendment of this kind iwould result, whatever the motive, :in a more hearty support of charitable institutions and I need not add now to what has Jbeen so well said by other hon. members on behalf of *these charities.
, Mr. MeKENZIE: I fully agree with the statement of the hon. member for Frontenac (Mr. Edwards) and others who say this amendment should not foe carried. The tax that anybody pays on his charitable givings is entirely too small to bother with. If a person is willing 'to give to charity I do not think he should he worrying about whether or not he is going to be exempt from the email amount of taxation that would be charged on that contribution to charity. I think it might well foe left to the charitable instincts of the people of this country who support the institutions that must live toy charity, I wish to state most emphatically that I am opposed as a matter of policy to any public institution being dependent on charity. That should not ibe the ease. There are a great many very excellent institutions maintained by charity. In the province from which I come there is a hospital absolutely independent of charity. The provincial hospital is absolutely independent of charity. The support of ithe sanitarium in the province of Nova Scotia is entirely independent of charity. The best form of support for institutions of this kind is to tax the people in the proper way so that those who are in charge of institutions of this kind will never have reason 'to he afraid that suffi-

client money 'will not be raised for the maintenance of the institutions. Those who are dependent on these institutions and those who are running them will have no anxiety as to whether the money will be forthcoming for their maintenance. I am bound to vote for the minister's amendment and to oppose the amendment of my hon. friend from London.
Amendment (Mr. Cronyn) negatived on division.


[Stage Direction]
Section agreed to.
Georges Henri Boivin: Shall the title carry?


Jean-Joseph Denis: 
Henry Lumley Drayton: A consolidation of the Acts may be brought about next year; it is not intended to do this year.


[Stage Direction]
Section agreed to.
Mr. NICHOLSON (Algoma):: Before the committee rises I would ask the minister whether any further consideration has been given to my suggestions with regard to the exemption of householders instead of married persons, and the taxation of a class of men throughout the country who are entirely escaping taxation on account of the inability of the department to reach them.


Henry Lumley Drayton: I am very glad the hon. gentleman has drawn my attention to that fact. I wanted to see the hon. gentleman and some others in connection with the people that are escaping taxation. I shall therefore not move the third reading to-day, but merely that the Bill be reported.


Mr. CRERAR:: There is a point to which I wish to invite the attention of the minister. I was unavoidably out of the Chamber when clause 10 was under consideration. Paragraph 7 of clause 10 provides that each person shall 'make his own assessment as to the amount of the tax, and paragraph 8 provides penalties for understating the true amount of the income. Now it occurs to me that an individual might, through ignorance or wrong interpretation of the law, make a return that was not correct, and still be in the best of good faith.


Jean-Joseph Denis: I rise to a point of order. I understand that the hon. gentleman needs the unanimous consent of the committee in order to move the reconsideration of this section.


Georges Henri Boivin: I did not ask that the committee give its unanimous consent to a return to the consideration of section 10. I intended to tell the hon. member that the clause has been amended in his absence by the addition of sub-paragraph 12. Was the hon. member aware of that?


Thomas Alexander Crerar: That, Mr. Chairman, does not cover the point I have in mind. I am quite aware that the clause has been passed and that I have no right to again refer to it now. But I would like the unanimous consent of the committee to bring this point to the notice of the Finance Minister.


Georges Henri Boivin: Is it the unanimous consent of the committee that the hon. member have leave to refer to clause 10 in order to ask a question?


Some hon. MEMBERS:: Carried.


Henry Lumley Drayton: I can assure the hon. member that the matter was considered in his absence; the point was brought up by several members. A person is not liable to penalties for anything he does not know. He is not liable for mistakes in his own assessment. He is liable if he makes a misrepresentation as to his income. He is liable to a direct penalty if he makes a mistake of over ten per cent in his income, and that is a penalty which is on the ascending scale. He knows about his income and nobody else dops. He is not liable for errors in the assessment he makes on that income because that is something that any one may make errors in connection with. The penalty merely covers first the misstatement in connection with the income and that means the amount of his own income and not the tax; and second, where the man does not pay, according to the assessment that he himself has made, the amount that he ought to pay.


Thomas Alexander Crerar: As I understand it the
clause is at variance with the statement which the minister has just made. Paragraph 8 states:
Any person liable to pay any tax or surtax under this Act who, in the return of the income liable to taxation, makes a return in which he states the income to be less than the true amount-

-shall be subject to the' penalty.


Henry Lumley Drayton: That is what I have just told the hon. member. It is the income not the tax. A person knows what his income is, or should.


Thomas Alexander Crerar: He may not. He may not correctly interpret the provisions of the law and may not make the return correctly under the Act. I would suggest for the minister's consideration the insertion of the word "knowingly" in the third line of paragraph 8, so that the provision shall read, "in which he knowingly states."


Georges Henri Boivin: Shall the clause carry?


[Stage Direction]
Section agreed to, Bill reported with amendments, and amendments read the second time.

[Stage Direction]
On motion of Sir Henry Drayton the House went into Committee of Ways and Means to consider the proposed resolution precedent to the amendment of the Special War Revenue Act, 1915. Mr. Boivin in the Chair:
William Stevens Fielding: I think we might well take these item by item, because the criticism applying to one item might not apply to all.


Henry Lumley Drayton: I would suggest that the committee might take the resolution as read. No one can remember it all, and here it is in writing.
In introducing these resolutions I do not know that I need add very much to what I said in my Budget Speech, except this; that we invite the careful attention of the committee to these different items., The Government stands absolutely on the question of principle, that revenue is required, and can be got out of expenditures of the character designated1; but in So far as the different items are concerned, the last word certainly has not been said in so- far as some matters of value are concerned; indeed, some amendments will be proposed. What we desire is to have the assistance of a full and frank discussion, bearing always in mind that revenue is urgently required, and that these expenditures are, in the main at any rate, entirely of a character that can largely be resorted to as a source from which that revenue ought to be obtained.


Michael Clark: I thank the
Minister of Finance for his invitation toi hon. members to give -him their
[Mr. CrerarJ
assistance in connection with these very important resolutions. Before we discuss any of the items, I think in a departure of this immense importance and, so far as this country is concerned, immense novelty, a number of general considerations ought to be taken into account. Now, if I may say so without offence, I am very much impressed with the way in which my hon. friend the Minister of Finance has conducted his duties in this House. I understand-although I am not any longer in the secrets of my friends on the other side of the House-that there have been discussions regarding the filling of a possible vacancy in the leadership over there-


Jacques Bureau: Hear, hear.


Michael Clark: -and if that is the case;-of course, I tlo not want to pry into the secret at all because there is no vacancy at present and none seems likely in the immediate future-if that is the case, in racing parlance I would be inclined to "put a little money" on my hon. friend as a "dark horse" in the race. Therefore, it is with considerable confidence that I appeal to him on a preliminary matter. He did me the honour and courtesy of listening to what I said on the second reading, when I pointed out very clearly, supported by the strongest authority, that, in the first place, these taxes or imposts, or whatever they are, are not excise taxes at all. I would like to ask my hon. friend whether he has thought of the suggestion which I threw out in all courtesy, that before we go any further he should re-christen these taxes? I supported myself by authority, which I do not want to quote until I hear what the minister has to say on the subject. But I do hope he will get himself further into my good graces by agreeing to my suggestion and re-christen these taxes at once, for they are not "excise" taxes.


Mr. LAPOINTE:: What name would the hon. gentleman give to them?


Michael Clark: The baby is not mine.


William Foster Cockshutt: Mr. Chairman-


Michael Clark: Pardon me. I should like an answer from my hon. friend the Minister of Finance to what is a very courteous question.


Henry Lumley Drayton: I am afraid, Mr. Chairman, that I have been more concerned with trying to raise the money in the way in which it would perhaps do the least amount of harm and from the class that

can most easily pay it, rather than to finally determine just exactly what those taxes ought to be called. I am of the view, in so far as their name is concerned, that I would pay, and do pay, a great deal of attention to what my hon. friend from Red Deer has to say. I realize that he knows much more about the names of taxes and the general system of political economy than I do. I am inclined to think therefore that probably I will be better able to answer my hon. friend's question when these taxes are better understood after the helpful discussion which I am sure the whole subject will receive at the hands of this committee.


Michael Clark: Mr. Chairman, I must go a little further in this question, and I shall end, if I have only the support of a seconder, by moving an amendment. These taxes, I repeat, are not " excise " taxes-*
-Some hon. MEMBERS: Hear, hear.


Michael Clark: -and I think it is discreditable to the Government, to this House and to the country 5 p.m. that it should go- forth to the world that we do not know what excise taxes are and that we allow this thing to isail under a name which it has no right to bear.
I quoted unimpeachable authority on the question, including Webster's Dictionary.


Some hon. MEMBERS:: Oh, oh.


Michael Clark: Of course, I can understand a certain proportion of my hon. friends opposite not having regard to any such authority, but I cannot understand my hon. friend the Minister of Finance not having regard to it. Webster's Dictionary says:
An excise duty is an inland duty or impost laid on articles produced and consumed in a country.
Does my hon. friend pretend for a moment that that definition applies to these taxes to be collected under the schedule as it reads now? As these taxes stand at the present moment a man goes into a retail shop to buy an article, and if it exceeds a certain price he is held up at the point of a revolver and made to pay a tax to the retailer, who for the purpose is appointed, willy-nilly, a tax collector by the Government, and has to pay a license for the honour. That is not an excise duty. I would reinforce myself further by an authority which ought also to carry very great weight with any one dealing with
taxes. The Encyclopaedia Britannica defines an excise duty as:
A duty charged on home goods either in the process of their manufacture or before they are sold to home consumers.
The essential feature in the first place about an excise duty is that it can be levied only on home goods. There is no pretence that that is so in the case of these particular duties. I protest for the honour of Parliament and the government of the country that we should call these things by a name which they would reasonably bear. They are not excise duties, and no member of the Government can prove that they are. My hon. friend (Sir Henry Drayton) has just spoken on the subject, but he has given us no enlightenment. After 1 spoke on the second reading, two of the ablest debaters in the Government spoke,-the President of the Council (Mr. Rowell) did not refer to the matter at all; the Minister of the Interior (Mr. Meighen), after parodying my definition of an excise duty immediately turned to me and said: "Is that the kind of duty that my hon. friend from Red Deer would put on? Then, there would not be many suits of clothes made in Canada." If my hon. friend were in his place, I should reply to him by saying that he knew very well that it was not the kind of tax that I would impose, and in the second place I should reply to him by saying that the kind of tax that I would impose in the country has nothing whatsoever to do with the true .meaning of the words "excise duties." May I add that in the intellectual sphere I have as much respect for a quibbling sophism of that nature as I have for a mosquito in the domain of nature? The point in debate at that time was what was an excise duty according to the well-accepted meaning of the English language. This Government, by Orders in Council and otherwise, living beyond its mandate, as I believe, has done a number of wonderful things; but it has not yet the power to change the meaning of the English language, and it should recede from the attempt. My proposition is made in very good faith. I gave some illustrations, and I do not want to extend the remarks I made on the second reading further, although what I am saying is absolutely apposite to the point under debate or the chairman would, I know, be on my track. I want to submit in the most emphatic language that I can use that a majority of 26 for a Government which was elected less than three years ago by a majority of 70, is a very precarious and fragile instrument to

stand behind these taxes, but it is a much more precarious and fragile instrument to upset the well-established findings of Webster's Dictionary and the Encyclopaedia Britannica.


Charles Sheard: I rise to a point of order. The hon. member's remarks have nothing whatever to do with the subject of the resolution.


Michael Clark: On the point of order, I may say that the first words in the resolution are " excise duties," and I have not been discussing anything else.


Charles Sheard: I contend that a review of the majority of the Government on the vote on the general principles of the Budget or a discussion of a question of terminology is not in order to be discussed on this resolution.


Mr. VIEN:: It is incidental.


Georges Henri Boivin: The point or order, as I understand it, is that the hon. member for Red Deer is at the present time reviewing the entire Budget debate. I would not so judge. I think the hon. member for Red Deer is perfectly justified in putting forward any argument which he may desire to submit in an endeavour to convince the committee that it should change certain words which he finds in the resolution. I, therefore, must decide that the point or order is not well taken.


Michael Clark: I most carefully guarded myself from using a single sentence which would come under your censure, Sir, and the point of order was all the less necessary because I had almost finished what I had to say. I have quoted unimpeachable authority to prove, and I have proved that these are not excise duties. You may call them trade imposts. You may call them " borrowings from the United States," and very bad imitations they are, because they go much further than they do in the United States. I called them "internal tariffs," but what they really are is " sales taxes." They are taxes on men who dare to make purchases along certain lines. I have proved that they are not excise duties, and I defy any member of the Government to upset my proof, unless, indeed, they are imbued to an extent that I do not believe they are, with the spirit of the description that was given of the Centurion of old. The. Centurion described himself in this way. He said: "I also am a man under authority; having soldiers under me; and I say to this man, Go, and he goeth and to another: Come, and he

cometh." But I submit to my right hon. friend (Sir Robert Borden) and to the members of that Government with him, for all of whom they know that I have personally a great deal of respect, that though they have done a good deal of saying " Come " and saying " Go," they should not prematurely, without due thought, say, "Go,", to the English language accompanied by Webster's Dictionary and the Encyclopaedia Britannica.


Mr. MACKENZIE KING:: I should like to supplement what the hon. member (Mr. M. Clark) has said about the advisability of using exact terminology in respect to taxation at a time when a variety of taxes are about to be considered.


Michael Clark: If I may intervene, I omitted to move my amendment. I move to amend this resolution by substituting the words " sales taxes " for the words " excise taxes " wherever the said words appear in the said resolution.


Some hon. MEMBERS:: No.


William Lyon Mackenzie King: I think it
would be well, in considering the amendment, to have before us as many authorities as it is possible to cite on such an important matter. The hon. member has given very substantial authorities in support of his contention that the weird " excise " is not rightly applicable to this particular form of tax. If there be one authority above another that is assumed to be reliable on matters of political economy, it is Palgrave's " Dictionary of Political Economy," and I have in my hand the volume which contains a chapter referring to the excise. I shall not recite the entire article, but the first paragraph of it is clear and explicit and, I think, will form a strong argument in support of the amendment. The definition of the excise, according to Palgrave's Dictionary of Political Economy, page 786, is as follows:
The excise is the name given collectively to those duties which in the fiscal system of the United Kingdom are levied upon commodities produced within the kingdom itself, as distinguished from customs duties which are levied at the ports upon commodities imported from abroad. The word excise (latin excido) signifies etymologically something cut off; as an excise duty may in effect be considered something cut off or deducted, for the benefit of the State, from the price of the article as paid by the consumer. If there were no duty the consumer would pay a lower price for the article. The price, therefore, that he actually pays includes the duty; whence it follows that the duty itself is something deducted or subtracted from

the actual price paid. The price in fact is divided into two parts, one part being subtracted from the whole for the benefit of the State, and the remainder going to the vendor.
>Duties of this character, whether levied on articles produced at home or imported from abroad, were at first equally known as excise duties, but in revenue parlance the word has long been restricted to duties on native commodities, those on foreign articles being known as the customs.
Then, the article goes on to state:
An excise -duty properly so-called belongs to the category of indirect taxes.
This tax is certainly a direct tax, not an indirect one, and in that regard, the word "excise" should not be used. Clearly the authorities on political economy generally are at one in agreeing that the word "excise" is used in contrast with the word "customs" to distinguish duties on articles produced at home from those on articles imported. I think thiat Parliament would do well, in its terminology as well as in its legislation, to follow a well established precedent so far as it iis wise to do so.


William Cameron Edwards: So much a gallon is collected on brandy or whiskey; would my hon. friend not consider that impost as coming under the definition of excise?


William Lyon Mackenzie King: If the article were manufactured in Canada, it would be excise duty; if imported, it would be customs duty.


William Cameron Edwards: I hold the same vedw that my hon. friend does in regard to, the application of the word "excise" to, liquors manufactured in Canada. Manifestly, then, the amendment of the member for Red Deer must be wrong, in part at least, because he would eliminate the use of the word in its application to those very things that the leader of the Opposition says it may be correctly applied to.


Ernest Lapointe: It is the title that is in part wrong.


William Cameron Edwards: The amendment would seem to be wrong; we should say "excise and sales tax."


Mr. CL ARK (Red Deer):: The title I suggest would be a true and accurate title, whether it applied to home produce or to foreign produce.


Robert King Anderson: The title of this particular clause which we are now considering is "excise and sales taxes."


William Stewart Loggie: Nearly tall the goods enumerated in this schedule are domestic made 211
goods. I venture to say that not one per cent of the boots and shoes used in Canada are imported goods. Practically the same applies to hats, men's and boys'; caps, men's and boys'; hoise or stockings, silk; neckties and neckwear. In Toronto a few days ago I bought fifty dozen men's neckties, domestic made goods, none of them sufficiently high in price to come under this provision.


William Stevens Fielding: If all the goods numerated were domestic made, my hon. friend's argument would hold good, but if some are not, clearly his argument fails. If these things are all home-made, "excise" is the proper word, but to apply the word "excise" to imported goods is incorrect. "A rose by any other name would smell as sweet." What the minister wlants is to get his money, and, with certain limitations, I would like to help him get it. But the use of the word "excise" is unhappy. The view taken by the hon. member for Red Deer is, in my judgment, sound, and should be sustained.


Isaac Ellis Pedlow: These taxes will be no
sweeter and no pleasanter to the person who has to pay them simply because of their being designated in any particular way. My suggestion would be to call this a commodity tax. That expression would have general application and would, I think, meet the situation admirably.


Henri Sévérin Béland: Does my hon. friend consider that whiskey is a commodity?


Isaac Ellis Pedlow: Yes.


Jacques Bureau: No, it is a convenience.


Isaac Ellis Pedlow: It depends on the brand that the hon. member uses.


Georges Henri Boivin: Order.


Henry Lumley Drayton: I am sorry
that what is evidently considered by some as an unfortunate use of words on my part has led to all this difficulty. My idea, though, is probably the idea of most of the people who are going to be hit by these taxes.


An hon. MEMBER:: "Hit" is right.


Henry Lumley Drayton: Yes, we are
hitting them; we have to hit them. We have to make a lot of the people understand that the war has to be paid for, just as it had to be won. We have on the one hand the customs taxes-the tariff, which a great many people object to-and, on the other hand, excise duties; that has been



the rough and ready division into which taxes in Canada have fallen. It is true that many definitions may be given of the word "excise." I notice that my hon. friend (Mr. ,M. Clark) relies upon an American dictionary for his definition. I also notice that the American authorities use the same designation in dealing with the same sort of things. But this American dictionary rather leaves the matter open. It defines excise, first, as "any commodity, toll or tax"; second, as "an inland duty or impost levied upon the manufacture, sale or consumption of commodities within the country." On the authority referred to by my hon, friend (Mr. M. Clark), therefore, we can say that an excise taxe is an inland duty or impost levied upon the manufacture,-that is one thing-and upon the sale, -that is another thing-no matter where the article comes from.


Michael Clark: Does it say that?


Henry Lumley Drayton: That is what I am saying. The definition does not restrict the application of the word to a duty or impost on the sale of an article manufactured within the country. It is a broad tax. It is a tax upon pursuits; upon the following of certain kinds of sports; upon certain trades.	Some people will
say that these taxes are a tax on certain trades; that it makes people engaged in certain trades act as collectors of public revenue and enforces upon them an obligation to which they were not subjected before. 1S0 that the authority referred to by my hon. friend shows that the use of the word "excise" as it is here used is a proper use. It is also a word which can be used in regard to license tax; exactions for licenses can be termed excise taxes.


Michael Clark: You would not import licenses.


Henry Lumley Drayton: That is true,
but I do not think that that has very much to do with the question. Further than that, it is a tax:
-applied to duties or fees levied upon makers of, or dealers in, excisable commodities, and finally to various taxes levied for permission to practise or conduct certain sports, trades, occupations. etc.
The English authority, the Imperial dictionary, goes further in support of my hon. friend's proposition than does the American dictionary on which he relies. The Imperial dictionary says:
An inland tax or duty imposed on certain commodities of home production and consumption, as malt spirits, etc.

But in England it covers many other things. It covers all kinds of taxes that are really interior taxes as against customs taxes. For example, it covers the right to keep dogs, to carry a gun, and to deal in certain commodities. The fact of the matter is that so far as custom is concerned, not only in Canada but also in England, the word "excise" is loosely used to describe any kind of tax that is not a customs tax, and I should have thought this a rather happy word for this particular tax. After all, as my hon. friend points out, "excise" means something cut off, and I am not sure that it is not a good name for this tax.


William Stevens Fielding: I do not attach as much importance to this matter as some other hon. members, but it is worth while to be right about it. My hon. friend in quoting the authorities appears to raise a possible conflict between the English and the American dictionaries. He gets a little comfort from the American authority, but I want to warn him that there are certain well known reasons why we cannot afford to deal with Americans. I do not want to repeat those reasons, and if there is a choice we had better take the English authority. The *authority quoted by the leader of the Opposition distinctly shows that an "excise" tax is so called to distinguish it from "customs" tax. But I want to set aside both the American and the English authorities and choose one that is better than *they, and that is, a Canadian authority. We have had a practice of our own. We know in Canada what "excise" and "customs" mean; they mean two distinct things, *and if you want evidence of it, my hon. .friend has a document for which he is responsible and which will be helpful. If he will take up his Estimates he will find that we have one branch of the public servic which is known as excise and another branch known as customs. That has been the distinction all through the history of 'Canada. It is a distinction we all understand, and inasmuch as it is familiar to ah Canadians and has always been followed in this country, we might safely put aside the English and the American authorities and follow the Canadian example. I think the point raised by the hon. member for Red Deer is well taken. While I do not attach the utmost importance to the matter-no matter what we call 'the tax it will be just as disagreeable-at the same time, it is just as well that we should be right. We cannot help if we find years afterwards that our statutes have been wrongly translated,

but in this matter we might very well be right at the outset.


Robert Laird Borden: I entirely concur in the opinion of the hon. member (Mr. Fielding) that people who must pay the tax will not lie awake >at night because of anxiety as to what we call it. It may be perfectly true that the political economists of the United Kingdom have use the word " excise " in a restricted sense, but it by no means follows that such has been the case on this continent. In fact, I hold under my hand a definition of the word excise by a high legal authority in the United States-I am referring to Mr. Bouvier's work-in which he defines the word excise in a wide sense. There is no restriction at all as to its application to goods that are produced in the country. And after all why should there be? Ii Parliament in its wisdom sees fit to impose a tax, which you may call a commodity or a sales tax or an excise tax, upon all goods produced in Canada when offered for sale, and upon all goods imported into Canada when offered for sale, is any great violence thereby done to the English language? I might quote what my hon. friend from Shelburne and Queen's has said, that the Canadian authority is best of all; and if tihe Parliament of Canada in its wisdom sees fit to enact that a tax upon goods sold in this country, whether produced in the country or brought into the country, having paid duties upon importation, shall be called an excise tax, I really do not think that ony one, however much interested he may be in preserving the purity of the English language, could take exception to that course.


Michael Clark: I am always impressed by an argument on the part of my right hon. friend the Prime Minister, and I also appreciate the ability of the Minister of Finance; but I cannot agree with the statement that this matter is not one of importance to the people. The thing that we have to bring home to the people is the fact that these are new taxes, and they should have a new name. We want the people to understand exactly what the Government is doing, and I think there is importance in that. My hon. friend the Minister of Finance said just now that we must bring it home to the people that they have to pay the money. I quite agree with hi*m, and I have expressed that opinion again and again; but I would bring that fact home most severely to the people who have the most money, and when we turn 211* [DOT]
round and take the other course I want the people to understand what it is that is being done. Now, my right hon. friend the Prime Minister says that no great violence is done to the English language if the Parliament of Canada enacts that this shall be called an excise tax. That was the precise point; what he stated as the Act of the Canadian Parliament in altering the meaning of English words. I cannot describe the proposition as other than one which is startling and takes my breath away. It is not the function of this Parliament to alter the meaning of simple English words. That is all the answer I really need to make to my right hon. friend. It is not the function of this Parliament and still less is it the function of this Government. I question if they have a mandate to govern-indeed the recent by-elections have shown that they have not-but certainly they have no mandate to alter the meaning of simple English words.
In regard to the speech of the hon. the Minister of Finance (Sir Henry Drayton) -he has come very recently to the study of the dictionary and he was interpreting his definitions as he went along. I am sorry for his own reputation that he stopped to emphasize the word "sold " in one sentence that he read. The sentence referred to articles "manufactured and sold in Canada." He says-mark this-" sold " as well as "manufactured." Is it not apparent to a third form school boy that the word "sold " refers to articles which have heen manufactured and therefore to those which 'have -been manufactured and sold within Canada? The whole sentence refers to the same set of articles. I can only classify his interpretation as I classified an argument from another source a short time ago. Clearly and manifestly the sentence refers to an article "manufactured and sold" in Canada. The Minister of Finance says that the word "excise" is loosely used. There is no possible justification for that statement. The word has been precisely used for a century. When the hon. gentleman says that I based myself on dictionaries it is only because I was dealing with one who was new to financial subjects, and I fortified myself with dictionaries. I had to give him what its meaning was from the knowledge I had possessed from my school days.


Some hon. MEMBERS:: Oh, oh.


Michael Clark: I care nothing about these exclamations from hon. gents;


Henry Lumley Drayton: The hon. gentleman says I am doing violence to the history of the country. Why, I am following what the hon. gentleman supported in this Parliament. I am following the language that he used as a supporter of the Government, and a prominent supporter of the Government, in 1918. I am following the legislation which was passed then. The legislation of this year is but an extension of what was done then. There is no difference in principle. Take for example what was done in connection with automobiles and jewelry, where the hon. gentleman is dealing with an imported article directly, where he is dealing with a home article directly and where in reference to both of them the excise tax is precisely the same. Where the article is imported such war excise tax would be paid by the importer and where the article is manufactured and sold such war excise tax would be paid by the manufacturer. I am following just what this Parliament has done and the manner in
IMr. M. Clark.]
which this Parliament has described a similar tax.


William Lyon Mackenzie King: I think this matter might be considered apart altogether from the question of authority and in relation primarily to what will be of greatest convenience to the public in studying and understanding fiscal matters. One may admit that authorities differ. I think, notwithstanding, the authorities quoted this afternoon are pretty well agreed that the distinction of importance is between customs and excise. The point I should like to make is that in future financial discussions we will have occasion to consider what revenue is being derived from customs, what revenue is being derived from excise, as we have used that term heretofore, and what revenue is being derived from the taxes that are now being imposed for the first time. Without some such separate classification, I am sure my hon. friend (Sir Henry Drayton) will find it difficult to make necessary distinctions clear to the House when he speaks of revenues derived from excise duties as the term has been used heretofore and revenues derived from excise as that term is being used in reference to this sales tax. If words have any use at all it is simply as vehicles for conveying thought and ideas from one mind to another. I would submit to my hon. friend that he will be conveniencing the public and every public speaker in endeavouring to interpret these taxes to a public audience by using words that have a common acceptation without any further definition of them. One hon. gentleman has suggested the words "commodity tax." That would seem to be a general and descriptive phrase by which the meaning could be easily and quickly grasped. When one uses the word "excise" the public mind is going to think of the word " excise " as it has hitherto been used as applied to existing excise duties. If the words " sales tax" were used, the public mind would not suffer confusion when this particular tax is under consideration. I think it will save confusion in the future and make for a clearer comprehension of important differences, if the suggestions made are considered in a broad light and not from the point of view of what position has been taken by one side as opposed to the other.


Robert Laird Borden: My hon. friend (iMr. Mackenzie King) seems to overlook the fact that we have already given parliamentary recognition to the word "excise"

in the sense which it is proposed here. By section 19 of chapter 46 of the Acts of 1918 the word "excise" was simply and unequivocally defined, as a duty levied not only upon articles manufactured in Canada but upon articles imported into Canada and put into consumption.
If we propose to depart from that use of the word now we ought to go back and amend the statute of 1918 in which the ward, as I have stated, was most distinctly used in the sense now attached to it in the resolution. I repeat once moire that (L cannot conceive, nor have I heard of any detriment to the public interest from the use of the word in .that sense in 1918, and equally 1 believe no detriment to the public interest can result from the same use of the word in the legislation now proposed by the Minister of Finance. Customs duties are one thing. Excise duties, whether levied on goods produced in Canada or on goods imported into Canada after the customs duty has been paid, are perfectly plain, perfectly distinct, and this use of the word need arouse no criticism whatever in the mind of any person.


William Lyon Mackenzie King: A point to b, borne in mind in regard to the matter to which reference has just been made is that these duties, whenever they have been collected by the State, have been collected- whether on imported articles or on articles produced at home-from the importer or manufacturer, or the producer; they have not been collected direct from the consumer. They have not been an extra tax levied upon the consumer which he, through the importer or the merchant, has transferred to the State. There is a real distinction between the method of collection of taxation we have heretofore spoken of as in the form of excise and the method of collection of the taxation that is being proposed at the present time; and if there is a distinction as wide as that it would seem, if terminology can assist us in making the distinction clear, that advantage should be taken of it.


William Foster Cockshutt: lit appears to me that a very large amount of fuss is being made about a very small matter.


Some hon. MEMBERS:: Hear, hear.
Mr. iOO'C'RSIHUTT : My hon. friend from Bed Deer is particularly exercised with regard to the words "excise duty," and he says we are really setting aside the English language in using them here. Now the hon. gentleman himself was not so careful in
the use of language as applied to these particular articles in his speech during the Budget debate, if my memory serves me rightly. I would like to ask my hon. friend if he can recall the word that he applied to these taxes during his speech on the Budget? Mr. Chairman, he applied the word "tariff" to these taxes, and that is what he is trying to clear the ground for at the present moment; he wants to bring in the word "tariff" a little later on. My hon. friend stated in his Budget Speech, if my memory serves me correctly, that this was not a luxury tax, that it was not a sales tax, but an addition to the tariff. I think I am right in that; I do not wish to ascribe to my hon. friend anything that he did not say. My recollection is that he stated it was an addition to the tariff and should be so characterized. Now whether the tax is an excise or not it is properly designated in the speech of the Minister of Finance as it has been reprinted and distributed. The heading of that speech is, "Excise and Sales Tax." Whether or not the designation should have been repeated in each particular case I will not say. I think perhaps the minister would have been well advised to have done so because there is something in my hon. friend's contention, and we do not want to have in operation a mis-named tax. However, the heading upon the speech is, "Excise and Sales Tax," which evidently pleases my hon. friend. Therefore it is apparent that whatever in the resolution is not an excise tax-and it is admitted there are some excise taxes in it-is a sales tax, and there you have the whole thing. Now if the minister would repeat the designation in every case that is apparently all that is needed; and apparently all the difference between the two hon. gentlemen, as far as I can see, is that the heading of these articles is "Excise and Sales Tax" and therefore in the resolutions themselves those words should have been repeated to have been absolutely accurate. But surely my hon. friend is not going to condemn the whole thing simply because of the insistence upon a name which when used is living up to the economic theories of Adam Smith, Cobden and Bright, and all those great economists of the past who were great authorities on taxation as well as language, and on language as well as taxation. There is no reason, Mr. Chairman, why any fuss should be made about this characterization. There are a great many more important things connected with this matter than the mere name. Of course there is smething in a name, especially if it is a bad name. The

tariff, with my hon. friend, is a very bad name. Therefore he wants to attach these luxury taxes to the tariff and then condemn them from the start in common with all free traders; but he cannot by any process of reasoning add these taxes to the tariff or make out that they increase the tariff, so far as I can understand the English language. I think if the minister simply employs the words that are printed at the head of his speech in connection with these resolutions I am sure that my hon. friend from Red Deer, who is at all times most reasonable, would not kick about a matter so small as this when at the same time he is getting in use his words "Sales Tax" and the minister is using the words, "Excise Tax." Then all parties will be satisfied for - it will be apparent that what is not covered by the word, "excise" is covered by the word, "sales."


Michael Clark: I have only a word or two to say if I may reply to my hon. friend's speech with three-quarters of which I agree entirely. When he described me as saying that this was in its nature an internal tariff I absolutely agree-he quotes me accurately. The reason l! figure that this in its nature is an internal tariff is that just as an external tariff takes so much money out of the consumer's pocket when levied-levied at the sea-shore so this tax takes so much out of the consumer's pocket when applied inland. If something is taken out of my pocket,whether at the seashore or inland, I can. assure my hon. friend I am so constituted that in the nature of things I cannot see the difference in the two operations-I am hurt in the same place. I am perfectly agreed as to his accuracy in quoting me, and I am still convinced of the correctness of my views as to what would be an accurate description of the real nature of this tariff.
Now my hon. friend and another hon. gentleman behind him have referred to the editorial heading of the speech of the Minister of Finance. Well, I am sure the minister will not attach so much importance to the heading of his speech that he would want that to set the seal upon the discussion we are having at the present moment. Where I differ from my hon. friend from Brantford is in this:	He says these duties
may be classified as excise and sales taxes. Now what I do most emphatically wish to point out to my hon. friend is, that as there are excise taxes and as there are sales taxes it is really rather a foolish procedure to ap-
ply the term " Excise Taxes" to what are "Sales Taxes." So that he really made a very strong speech in support of my amendment. I only asked very modestly that the words "excise duties" or "excise taxes" should be changed for "sales taxes" in the resolution which we are now considering, if the tax on clothing, and other commodities mentioned therein is to be collected by the vendor at the time of sale. So that I submit to my hon. friend-for whose intelligence I have as much respect as he has for my reasonableness - that if there are both excise duties, or excise taxes, and sales taxes, in these resolutions, as the first resolution refers only to the sales taxes then let us call them sales taxes and not excise taxes.
Amendment of Mr. Clark (Red Deer) negatived: Yeas, 39; nays, 66.
At Six o'clock the committee took recess.
After Recess.
The committee resumed at Eight o'clock, Mr. Boivin in the Chair.
The CHAIRMAN When the committee rose at six o'clock we were considering resolutions to amend the special War Revenue Act, 1915.


Michael Clark: May I call attention to the fact that the minister in charge of these resolutions is not in his seat?


Georges Henri Boivin: The minister is in the Chamber.


Henry Lumley Drayton: I have left my seat for a moment.


Michael Clark: I am glad to
see the minister has joined the right side of the House.


Donald Nicholson: I should
like to say a word or two with regard to the method of collection of these taxes. In the main, under the provisions of the resolutions as submitted to the committee, the taxes are to be collected by the retail merchant at the time of sale to the ultimate consumer. While having in mind the question of bringing home to the ultimate taxpayer just what these taxes are going to mean to him, and while there is doubtless something to be said for that argument, nevertheless I think the principle contained in thes eresolutions as to the manner in which the taxes are to be collected is going to bring about an almost impossible situation. I take it for granted that the aim of

the Minister of Finance is to secure revenue, and my judgment, after considering the matter with some degree of care, is that the minister, by collecting in the method that is suggested to the committee at the present moment, is not going to get the revenue that these taxes should produce. There are many reasons for that. So many individual transactions have to be covered in securing a definite sum of money that, in the first place, it will be almost impossible to keep a record of the transactions. In the second place, where there happens to be a man who is in business for himself or employing those who may not want to follow this method of taxation honestly, a means is opened up for defeating the very object of the tax and creating, if I may use the term, almost a generation of that class of people who always like to "beat the Government" if they can. During the past two weeks I took the trouble to inquire closely what this means as regards the work involved on the retailer. I may say at once that I am not in the retail business, and the suggestion I have to make before I sit down, if it hits at any one, will hit at the class of people with whom I happen to be associated. I took what I think would be recognized as a not-above-the-average retailer, a man doing a retail business in a town of 3,000 people where there are seven other retail stores. I found that in one day's business, that man had 807 sales' slips, charge and cash sales, involving sums all the way from one cent up. Of those 807 sales' slips, approximately 100 were for sales that would come under the resolutions and for goods that would be taxable. I submit in the first place that if the department are going adequately to check the sales to see that the taxes are properly collected, they would require to cheek the whole 807 sales. I reduced this as nearly as I could to figures in order to see what this meant for the whole Dominion of Canada. There are upwards of 200,000 retailers in business in Canada; and assuming that this man is an average retailer, and assuming that you could get accountants to check these slips at the rate of 10 a minute, it would take 8,000 people working seven hours a day continuously to do nothing but check the slips, provided that all the slips are checked-and if the department are going to see that all the sales that should be taxed are taxed then every sales' slip, whether cash or credit, should be checked. But if we reduce this simply to 100 sales in that particular man's case, it
would still take 1,000 people to check all the sales' slips of all the retailers in Canada. When that retailer to whom I have referred comes to make out his monthly statement to the department, the statement that he must make out will cover 43 sheets of foolscap paper. If you multiply that by 200,000, you will find the volume of returns that the department will have to check in order to get this sum of money. Besides all this, you, are imposing on the retailer a burden that he should not be compelled to carry. You are putting him in a position in which it is not fair to put any class of man, in relation not only to his customers, but to carrying on his business. I do not wish to weary the committee by going into any more of these details. After carefully reviewing the whole situation and discussing it with men who are themselves anxious to assist in working out some practical method of getting the additional revenue the country must have, I have come.to the conclusion that this is an almost impossible method of collecting this tax. The suggestion I have to pass on to the Government and to the minister is this, that after having modified the details of these taxes, as I have no doubt they will be modified in relation to some of the articles, they should then collect the tax on the specific goods that it is finally determined shall be taxed, at the point of manufacture of the finished article and at the point of importation of the finished article. That method can be worked out so that the department will have an infinitely smaller number of transactions to deal with; they will get more revenue, and they will relieve a deserving class of people in this country of a burden that, I think, should not be imposed upon them. I am not at the moment going to move any amendment; I pass this on simply as a suggestion, and I trust the Government and the Minister of Finance will take it into their very serious consideration.


Michael Clark: I am very glad my hon. friend (Mr. Nicholson, Algoma) has raised a question which must have been in the minds of every hon. member who has given serious attention to these taxes, the question of the machinery for the collection of these taxes. It is a most important question. We have, in effect, in power in this country at the present time a Cabinet of lawyers. I wish the Government had in their ranks one or two business men such as the hon. member who has just spoken; because they would have saved the Government from getting into trouble such as they

have got into. I have listened with the utmost care to what the hon. member has said, and he has pointed out some of the difficulties connected with the machinery for the collection of these taxes. What is happening at the present moment in1	regard to	these taxes?
Men in business along certain lines in this city-indeed, this applies to the whole of (Canada-find that they are suddenly compelled, by reason of these proposals, to employ a bookkeeper where they did not need one before. Why? Because they have to keep track of all the sales in connection with the new taxes proposed under this resolution. What is it that we actually propose to do under this resolution? We propose to make almost every retail trader in Canada a collector of Government taxes, and make him pay a license fee for the privilege of collecting those taxes. iHe has been doing his ordinary business, with his ordinary staff, under the principles of freedom, but under the principles of [DOT]coercion, which are the secret and the heart of this taxation, he finds that in many cases he has to put on a bookkeeper. Who pays the bookkeeper? The consumers of Canada. Before we go into any detail in the discussion of these taxes we must get to know what they mean in bulk. It is a fact that business men in Ottawa have already had to employ a bookkeeper where they were previously doing their own business. That bookkeeper, call him what you like, is practically an increase of the Civil Service of Canada. It is true that the Government will not have to pay his salary; his salary will come out of the consumers of Canada. If we go along this line, where shall we get to? I am grateful to my hon. friend from Algoma East (Mr. Nicholson) for raising this question of the machinery of taxation.
I should like to know whether the minister can give us any general ideas, before we go [DOT]into details, as to the machinery by which he proposes to collect these taxes, from Halifax to Vancouver, from the northern seas to the American border.


John Hampden Burnham: I would be derelict in my duty if I did not voice the sentiments of my constituents. Their protests have been long and loud in connection with this matter; they object to having to collect the taxes. There may be an explanation; I have no doubt that there is; it would be absurd to suppose that this complication is to be set upon the people and left there for them to fume over. I am satisfied that the minister and the commissioners will between them evolve some plan. I am also 
[DOT]satisfied that the hon. member for Red Deer, who is a doctor, is not the man to lecture a cabinet of 'lawyers. Much as I respect the medical profession, I would-


Michael Clark: I am a farmer.


John Hampden Burnham: When a man goes into business he prepares the way through a lawyer; when he goes out he prepares the way for his funeral through a lawyer.


Isaac Ellis Pedlow: Before we proceed further with the general discussion of this subject I think it would be in order for the minister to explain this resolution. I understand that since the resolution was proposed in the Budget Speech, certain modifications of the schedule have been determined upon. If these modifications, together with any other information that the minister wishes to furnish, are communicated to the committee now, matters will be simplified and a good deal off discussion may be avoided.	[DOT]


Henry Lumley Drayton: I am glad to
comply with my hon. friend's suggestion. I will say a word first with regard to the matter that has been spoken of by the member for Algoma East (Mr. Nicholson) and other hon. gentlemen. There is no doubt that it is easy to turn away from the duty that is unpleasant; it is easier to borrow money than to impose taxes; tt is much easier to drift than to row against the stream. It is very much easier for the retail merchant if he is specially protected in connection with this matter, and if there is any way of specially protecting him without loss to the State or inconvenience to the community, he shall be protected. On the other hand, if the economic necessities of the situation demand that he should be conscripted, if you like, in his country's service, then he ought to be conscripted in that service. I am not saying at the moment that that is necessary; I shall be pleased to take this suggestion and every other suggestion that is made into my most earnest and careful consideration. What we want to do is to get a maximum of revenue with a minimum of inconvenience, and a maximum of revenue from those classes of people that can best afford to pay. One of the main objections to most forms of taxation is not only that the taxation itself is passed along, but also that profits are predicated on that taxation. What we all try to get at is a tax which will be borne by the men best capable of paying it, a tax so designed that it will not be possible for the person who should pay it to make

somebody else pay it -for him, and at the same time .to .charge .profits on that tax as part of his expenses. That is the main reason why the burden of collecting the taxes has been placed upon the retailer; that is the main reason why similar action was taken in the United States. We have had very marked drops in prices since this taxation was introduced. Would hon. gentlemen expect similar drops in prices if, instead of the purchaser knowing what the tax was, the manufacturer and the wholesaler had been put in the position of .paying that tax in the first instance .and then charging a profit upon it? So far as collection is concerned, our task is indeed easy; if we put the tax upon the .manufacturer and upon the wholesaler we shall have little or no trouble; we shall get a .larger revenue, .and we shall stop a leak here and there which otherwise would not be stopped. But what about the man on the street? What about the man who makes the purchase? We are trying to think of him; we are trying to work out .something which will bring down rather than multiply costs.. Most taxes .are brought into, the cost figures of the concern and have profits placed upon them. This tax cannot be so treated. Everybody knows what the tax is when called upon to pay it, but he need not pay it unless he wants to. Now, that leaves the very important question for consideration and for ultimate determination whether it is in the public interest to collect the maximum of taxation, or whether we should not, on the one hand, seek revenue, and, on the other hand, seek to bring down the cost of .commodities, to bring down the general high cost- of living. Every purchaser should know that when he is buying an unnecessarily expensive article he is paying a little .bit for his extravagance, and is paying to some extent for something that is not an intrinsic quality of the article. We have to consider whether it is worth while that this should be realized. As I have said in connection with *all these resolutions, bearing in mind always the condition of the Country and the fact that we propose to pay our way as we go, to raise proper revenue and, as far as possible, reduce- the high cost of living, all these proposals are submitted to the House in the hope that we may be able maternally to improve our condition. The hon. member for South Renfrew (Mr. Pedlow) has .asked me what concessions it has been thought possible to make in connection with the 'taxes proposed, and I have much pleasure in taking the matter
up in answer to that inquiry. The first taxes which we have are the taxes on boots and 'shoes. There is no question that boots and shoes are an absolute necessity; the only .question Sis that tof (reasonableness of price.


Michael Clark: I .asked the minister to give us some idea of the machinery by which he is going to collect the taxes, and he proceeds to discuss the details. Is this to Illustrate that (machinery, or am I to- understand that he refuses to answer imy question? I (want to know something about the machinery. What .machinery does the Minister of Finance propose to institute from Halifax to Vancouver for the collection of the taxes? This question has a most important bearing on the whole subject, because if you put into force machinery which is a duplicate of the customs -staff you increase the Cavil Service and throw away the taxes at ,the same time.


Henri Sévérin Béland: Before the minister passes to -a consideration of the individual items, I desire to express my concurrence in the view of the hon. member for Red Deer, that we must first of all knoiw, before we discuss the items, what is the exact machinery that will be employed to collect the taxes. It is now stated in a general way that the taxes should be collected by the retailer. Has the minister realized what it would mean in actual practice for country retail merchants to- collect the duty on (every yard of ribbon that they sell? Let me illustrate (this point. There are five persons in a country store in the morning each of them .seeking to .buy, let us say, a yard or two of ordinary ribbon, which is not a luxury. Some ribbon retails at fifteen cents a yard.


An hon. MEMBER:: Fifteen cents?


Henri Sévérin Béland: Let us say fifteen cents; that is the average price. The little girls going to school wear this ribbon on their hair, and I do not think you would call that a luxury article. However, the merchant sells, a yard of this ribbon. Do I understand that he is to make a duplicate sheet for the fifteen cents and one for the cent and a half duty he is going to collect, and that he is going to. keep track of that sort of thing from the first hour to the last hour of the day; and that every two weeks or every month, as the case may be, he is going to supply a report to the department? This is one illustration amongst a thousand. If a retail merchant wanted to carry

out the provisions of this resolution he would have to get additional assistance that would entail an expenditure of perhaps a thousand dollars a year. Do hon. members realize what a thousand dollars means to an ordinary retail merchant in a country store? This is a most serious 'question. Cannot the minister find a way to collect through the wholesale dealer these taxes on all the articles mentioned in the resolution. The retail merchant in a country town buys a hundred dollars' worth of ribbon from a wholesale dealer in Montreal, say,-who makes an invoice foT $100 and $10 of excise duty. This is collected from the merchant, who can then fix his price so as to cover any loss in connection with the tax imposed upon him. Could not the minister devise some such scheme? I have consulted a good many retail merchants, not in any attempt to prejudice them against the tax, but simply to ascertain their views; and they all to a man agree that it is almost impossible for them, with the best will in the world, to carry out the provisions of this law. As my hon. friend from Red Deer has said, it would require machinery that would be more expensive than the collection of the customs duty in Canada, whereas if the minister could attain the same end through the agency of the wholesale dealer the work would be much simpler. The only argument the minister can advance against collecting the taxes through the wholesale dealer is that he wants every customer who buys one of these articles that are designated as luxuries to know that the country is collecting a tax from him. Is it so important that a man who is in need of a ten-dollar pair of shoes should know he has to pay a dollar on them? I do not want to go into details, but ten-dollar shoes are not luxuries in my district, where so many ordinary workingmen who axe >at work in the forest, in the driving of logs, require boots and shoes that cost from $12 to $14 and $15.


Mr. ARMSTRONG (Lambton):: As I
understand it, the hon. member for South Renfrew asked the minister a question. The minister was attempting to answer it and to give the changes he intends to make to these resolutions. Why not allow him to put them on record? Possibly he was dealing with the question that- the hon. gentleman (Mr. Beland) was talking about.


Henri Sévérin Béland: My hon. friend is quite mistaken. The minister was referring to the . machinery. He apparently had disposed of the question.


Joseph Elijah Armstrong: No.


Henri Sévérin Béland: Yes, my hon. friend need not say anything to the contrary. The minister had entered upon another point, was considering another article; he was not specifying the way in which the tax would be collected, because he had disposed of that.


Joseph Elijah Armstrong: I understand he was dealing with the changes he intended to make.


Henri Sévérin Béland: Changes? Yes, as to the minimum amount at which a specified article should be placed. He disposed of the question with a wave of the hand, as it were. He was speaking of the machinery. The people must know, he said, that there is a tax on a pair of shoes; they must know when they are paying it. He had disposed of that. He said that he was disposed to consider the suggestions that would be made in regard to the change in the minimum price for one particular article. But as to the machinery, he appeared, at least in so far as I could understand him, to be unwilling to consider any proposal to collect the tax in any other way. I cannot too much insist upon this point. I think the minister should have adopted a simpler way of collecting the tax. The retailers would be better satisfied; he would get his revenue; and we will tell the people that they pay the tax.


Mr. McCREA:: Most of them know it now.


Henry Lumley Drayton: The hon. gentleman (Mr. Beland) is entirely in error. If I said what he thinks I did I improperly expressed myself. I did not refuse any discussion or consideration of the method proposed, but on the other hand, I interrupted and said I would be very glad to go into it and personally to give it my best and most carefful consideration. Further than that, I used words to the effect that while it was my duty and the duty of the House as I conceived it to see that the necessary revenues are raised, if this whole talk about raising taxes and paying our way as we go is not idle chatter, it was also our duty to see that these taxes were collected in the very best and most economical way, in the way which would lead to the least friction and place the least burden upon any section or class in the country, be they retail merchants or any other. My hon. friend from Red Deer has asked what is proposed to be done. In the first place what is proposed to be done is to take advantage of every

constructive suggestion which hon. gentlemen are kind enough to make with that end in view. Apart from that, what would ordinarily be proposed to be done, and what will be done, is to arrange through the Department of Inland Revenue, which department already has the matter in hand, for a proper and systematic way of collecting the tax.
Let me say one thing right here. Whatever hon. gentlemen may say, I think that in so far as the great mass of the retailers of the country are concerned, they do not need hon. gentlemen at their elbow all the time telling them what they should do. I do mot believe it is going to require an army of men to look after the tax. I believe the great majority of the retail merchants are anxious to co-operate in the collection of this tax. They told me sto themselves. They take the view that if this is the only way and the best way the money can be got, while they not like it, they are yet prepared to do their bit, and they iare doing their bit. I do not believe they are a class of men who are going to try and see how much they can knock out of the treasury or how much they can filch from Canada. Therefore, I repeat, we are not going to require any great army of men to look after this tax. We ought not to. While my political experience is short I have had a lot of knocking around Canada and my experience of the Canadian generally is that where there is an honest way of doing a thing he does it honestly and that the crooked man is indeed an exception in this country. We do not propose to employ an army of detectives; we propose to have a very limited number of men to instruct rather than to prosecute or intimidate.
The method by which these taxes can be collected is of course .a matter of regulation. It may be that the whole of the taxes can be collected through the medium of the stamp tax, and if they are collected through the medium of the stamp tax there is no necessity for the book-keeper that the hon. gentleman speaks of. As I said I do not want to pass finally upon everything. No one is more conscious than myself of the fact that this is my first session in this House; no one is more conscious than myself that I require instruction even from the hon. member far Red Deer. But, also, no one is more conscious of the fact that revenues have to be raised and that, inasmuch as this is possible, that we can do it. it is the direct duty of this House to do everything it can not only towards the
raising of the revenues but in regard to the method to be adopted for the raising of the revenues, and to assist in the gradual process of deflation which is so greatly to be desired.
The hon. member for Beauce (Mr. Beland) says I am dodging the question. Why? The question of the cent and a half a yard on ribbon is something that can only be dealt with by treating it in the way the hon. member for South Renfrew (Mr. Pedlow) desired it should be dealt with. - It so happens that I agree with the hon. member for Beauce that cheap grades of ribbon should get recognition and that it should not be necessary for the merchant to make a deduction, or a collection, of a cent, or a cent and a half, per yard on ribbon sold. Boots and shoes certainly .are necessities. My hon. friend from Beauce has made an argument in connection with boots of a character which would be entirely unnecessary in view of the changes to be made. Clothing and the different articles which go to make up Coats and the usual attire are also essentials. Representations have been made by manufacturers of boots and clothing, by wholesalers and by retailers. The retailers do not at all occupy any individual position here. They are not objecting iany more fiercely ot any more strongly than are the manufacturers or the wholesalers. The objections are general, there is no question about that, so far as all these classes of people .are concerned.
An (hon. MEMBER: Sure.


Henry Lumley Drayton: An hon. member says, "Sure." He will not find the same objection from the man who, during the last two weeks, has been able for $8.50 to buy a shoe that formerly cost him $12 or $16, or the man who gets for $45 a suit for which he formerly had to pay $60. There has been a lot of talk about the Budget. It has been described by hon. gentlemen opposite as a Budget of the Interests, and not a Budget of the poor people or for the poor people. I would like them to have been around when the gentlemen whom they describe as "the Interests" were making their representations as they have been for the last three weeks. Then they would at least know that they are entirely wrong, or that the manufacturers and the wholesalers-[DOT] "the Interests" that they from time to time talk about-did not know their business.


Arthur Bliss Copp: I would like the minister to inform the House where he can buy for $8.50 a pair of shoes that formerly cost $12.


Henry Lumley Drayton: Yes, at Gales', here in Ottawa.


Arthur Bliss Copp: I am glad to get this information.


Henry Lumley Drayton: I should not
single out that firm-


Mr. OOPP:: I am glad to know there is one place.


Henry Lumley Drayton: You will find that condition all over.


Arthur Bliss Copp: There will be a run on the market.


Henri Sévérin Béland: What assurance has the minister that $12 shoes have been reduced to $8.50?


Edward Walter Nesbitt: If the minister will allow me to answer I will give the hon. member an instance. I have a young lady-


Some hon. MEMBERS:: Oh, oh.


Edward Walter Nesbitt: What's the matter with you fellows over there?


Ernest Lapointe: There is nothing the matter with us.


Henri Sévérin Béland: All the matter is with
you.


Georges Henri Boivin: Order.


Edward Walter Nesbitt: The trouble with you people is that you have young ladies in a diffeient manner to what I have.


Some hon. MEMBERS:: Order.


Edward Walter Nesbitt: That's not so funny is
it?
Mr. LAPOINTE,:	Do you buy boots for
her?


Edward Walter Nesbitt: I know a young lady who bought a pair of boots in Toronto for $12. They did not fit her and she sent them back. It happened that the Budget came down in the interval and she bought exactly the same kind of boots, only of a different isize, for $8.75.


Isaac Ellis Pedlow: I would like to correct
a wrong impression that might be left on the House and the country. It is absolutely unfair to the retail trade of this country, and I speak advisedly on this subject-
)Sir HENRY DRAYTON:	Order, this is
not asking me a question. I would like the floor if the hon. member pleases.


Mr. BEST:: The statement to which the hon. member has referred is absolutely true. The hon. member need not deny it, because everybody knows it is a fact.


Ernest Lapointe: Order.


Henry Lumley Drayton: I do not think that any attack should be levelled at the retailers; they do not deserve it. I am not making any attack on them; I am saying that prices have come down, and we all know it to he true.


An hon. MEMBER:: Oh, no.


Henry Lumley Drayton: I am not saying that prices are going to stay down permanently; I am not saying that the goods can be reproduced at the same price; all that, I am saying is that prices have come down.
Ain hon. MEMBER: That is merely to evade the tax.


Henry Lumley Drayton: 
Mr. PROULX:: And surveyors' boots?


Henry Lumley Drayton: They would
come within the same category I should think.


Michael Clark: Will my hon. friend exempt cripples' boots?


Henry Lumley Drayton: They are still exempted.


Michael Clark: Are the profiteers always crippled?


Henry Lumley Drayton: Well, the present process is deseriped by some as crippling them very severely, so much so that they say they will not be able to carry on business in the near future with any profit. I do not know whether that it so or not, but if it is any satisfaction to my hon. friend I am very glad indeed to give him the information.
Then trousers, sold separately from suits, in excess of $12 per pair; coats, men's and boys', sold separately from suits, (not including leather coats lined with sheepskin) in excess of $25 each; cloth overcoats, men's and boys', women's and misses', in excess of $50 each; waistcoats, men's sold separately from suits, in excess of $5 each; dresses, women's and misses' (except silk) in excess of $45 each; skirts separate from dresses, (except silk), in excess of $15; suits, women's and misses' (except silk) in excess of $60 each; coats, women's and misses', sold separately from suits (except silk) in excess of $35 each. Hon. members will see that we have included in that list practically everything which would fall within the general description I was dealing with before, that is absolutely essential articles of clothing, in so far as suits, coats, boots and the like are concerned, and we reduce the tax from ten per cent on the full cost to fifteen per cent on the excess.
Then there is a further stipulation in connection with that, which was in the original schedule; that on articles of clothing the prices of material and cost of manufacture are to be combined ffor determining the selling price.
We do not propose any change at all in the tax on articles the purchase of which may be regarded as an extravagance entirely within the control of the purchaser. For example, we do not think it is any hardship for a man to pay a tax on any hat be wants to buy over $5; so we leave on the $5 limit and the tax at ten per cent on the whole amount, Hats, caps, men's socks, neckties, shirts, ladies' hats, ladies' stockings, corsets in excess of $5, kimonas and waists, petticoats,-all these are left just as they were with the exception of what I have pointed out in the suggestion made, because it is entirely a matter of volition

whether a purchaser indulges in an expensive article or not. A good hat can be purchased at less than $5, and if a man wants a cap he can get one for 50 cents or $1, unless he wants a fancy one-and I admit they are chiefly of that class-and then he should be able to get a good one at $2.
Walking sticks were not covered before while umbrellas were, and I am quite sure that hon. gentlemen will agree that they should be included.


Michael Clark: Does my honourable friend mean to include walking sticks?


Henry Lumley Drayton: Walking sticks are now in. We propose also a change in an important item, having regard to representations made, particularly from the West. The original resolution put a limit of $100 on the cost of fur coats, and I am frank to admit that that limitation was entirely too low-not too low as prices were at the time I bought the coonskin coat I still have, and which I think is a pretty good coat, but I find that I could not replace it to-day at anything like the price I paid some years ago. So it has been determined to double the minimum on fur coats and make it $200. That action is taken in view of the necessities of the climate and the way in which the cost of furs has gone up,-although I am very glad to be in a position to inform hon. gentlemen that furs will be coming down in price very soon.
Mr. COPP [DOT] What is the tax on the excess?


Henry Lumley Drayton: It is ten per
cent on the total amount. You can get a good coat for $200.


Thomas Alexander Crerar: Has my hon. friend
made any distinction between men's and women's fur coats?


Henry Lumley Drayton: No, we have
made no distinction. There is a less amount of fur in the ladies' coat, but I admit there is generally more style.


Michael Clark: On this question of clothing, will the Finance Minister let us off being taxed by night? I notice he has a tax on night-gowns and nightshirts. If we are taxed by day, that is quite sufficient


Henry Lumley Drayton: I am quite sure the patriotism of the hon. gentleman is such that he would like to pay taxes, though sleeping. In the same way we should increase the price of driving gloves, winter gloves. We have raised that to $15.

We have raised the price of fur caps to $15. We have made the price of muffs and neckpieces to $35, and the price of robes and rugs, $50.


Edward Walter Nesbitt: The minister said
"gloves". Does he mean fur gloves?


Henry Lumley Drayton: Fur gloves.


Mr. McKENZIE:: It would be unreasonable for the minister to expect the committee to pass the resolutions with the changes that he is making. The resolutions are being changed almost in every particular; for myself I cannot hear what the minister is saying, and I do not know what the changes are. The resolutions should be recast and reprinted and distributed as amended amongst the members. Then we shall have a few hours to look over them so as to see what the changes are. I can assure the minister that he will make no progress if he continues in that manner of putting the matter before the committee.


Henry Lumley Drayton: I had not for one moment the slightest thought or expectation of asking hon. gentlemen to pass these resolutions to-night. I am desirous of giving the fullest information I can at the earliest possible minute. Perhaps it will be sufficient to put these changes on Hansard, but I shall have much pleasure in bringing down a reprint, as the hon. member suggests, giving a new schedule for the guidance of hon. members. It is advisable to do that because, as I have told hon. gentlemen, we want constructive suggestions. It may be we are not getting all .the money we should get; it may be we have left out something we should put in, and I am quite sure hon. gentlemen desire to assist the country at the present time and will be fruitful of constructive suggestions, looking towards larger revenues. This list may help them in that regard.


Thomas Alexander Crerar: Has the minister's department made any estimate of the amount of money that will likely be secured under these taxes? That is a matter of very much concern to the House and to the country. These taxes are new ones entirely, and while I sympathize fully with the aim of the minister in securing as much money as possible, I cannot, by any means, agree with the argument he has made in support of this resolution. I certainly commend him lor inviting constructive suggestions from the committee. While I am on my feet, I might state that I have had personally many protests against the application

of this tax, particularly the proposals to make country and retail merchants throughout Canada tax collectors for the Government. I might cite one case particularly that comes to my mind at the present time.


Henry Lumley Drayton: I gave way to my hon. friend as I thought he wanted to ask me a question.
.Mr. CRERAR:	I beg my hon. friend's
pardon; I thought he was through.


Henry Lumley Drayton: No, I have only commenced. In answer to the question of my hon. friend as to the revenue, my hon. friend will see at once that, as regards the great bulk of these luxury taxes, if we get saving instead of extravagance, if expenditure is curbed, we are not going to have a very great amount of money raised. On the other hand, if the people continue to spend in the way they have been doing in the past, these luxury taxes will be very productive, but it is guess work to say what will happen..


Thomas Alexander Crerar: Quite a reputable business man, in whose judgment I have considerable confidence, stated to me that he had estimated that these taxes would bring into the treasury at least $300,000,000. Does the minister agree with that?


Henry Lumley Drayton: No, I do not
agree with that at all. I think that is very much higher than anything we can hope for. Knitted sweaters and knitted sweater coats were not included in the original resolution, and at the appropriate time I am going to ask leave of the House to introduce a resolution covering them.


William Stewart Loggie: Before the minister proceeds, may I ask him a question? In his list, I understood he did not include leather coats used by woodsmen. I should like to remind the minister that the coats commonly used by woodsmen are known as mackinaw coats. Is it not the intention to exempt that class of garments from taxation as well as leather coats? The leather coat is much more expensive than the mackinaw coat, but the latter is much more commonly used by woodsmen.


Henry Lumley Drayton: That is something that I shall be pleased to take up with my hon. friend.


Michael Clark: I do not- wish to interrupt my hon. friend, but what is the course we are following in this debate? We come to discuss certain specific proposals which were submitted in the Budget Speech,
which were attached in printed schedules to the Budget Speech. Are we listening now merely to alterations which the Government propose to make in those, and are we going to discuss the alterations at a subsequent date, or are we to take the Budget proposals as serious proposals of the Government for Parliament and the people of this country? What are we doing? We have been here for four months; we waited for the. Budget; we have it, and we have it in printed shape. Now the minister is giving us a whole list of alterations in detail. We have not yet settled, as regards committee discussion, the principles of this legislation. Are we listening to a set of alterations upon which we have to recast all the legislation at a future date? I should like to know what the procedure is that we are embarked upon, and I think I am in perfect order in asking that question.


Henry Lumley Drayton: I hasten to
assure my hon. friend that the Budget is not a joke and that anything that has been done has been done merely to relieve cases where it is thought that a proper case has been made out for relief; that the further changes -and there are not many-are made to include articles of luxury which ought to have been included in the first resolution and which were omitted; that there is no change whatever in the principle of the Budget, which is a tax on expenditure, most of which is avoidable. What we are doing now is this: I have asked for suggestions, and I still think it is a proper thing to do in connection with new and novel legislation to ask hon. gentlemen for constructive suggestions. If I am wrong, then that kind of suggestion is altogether wrong, and all the minister should come down to Parliament for is to1 logroll something through irrespective of what hon. gentlemen may be able to add to his information or lack of information on the subject. Further, what I am doing is endeavouring to answer a perfectly proper question put by the hon. member for South Renfrew (Mr. Pedlow) and I intend to proceed to answer that question.
We also propose a modification in connection with games and spoTts. What we propose to do there is to make a concession in the matter of popular games, such as baseball, lacrosse, hockey and football. We are removing these from the list of commodities subject to the general tax, but a price limit is being applied, so that if any one wants to get anything particularly fancy in connection with these games, some payment by way of taxation will have to be made. '


Mr. EULER:: Is the minister making an exception of baseball supplies?


Henry Lumley Drayton: Yes.


An hon. MEMBER:: What about skates?
-Sir HENRY DRAYTON:	Baseball bats
and baseballs will be exempt up to $1.25 each; baseball mitts and gloves up to $1.50; skates-here I am thinking of children's skates, not of expensive skates used by adults-up to $2; footballs-again, the kind used more particularly by children-up to $3; lacrosse sticks up to $1.50; hockey sticks up to 75 cents. Then, an addition is proposed so far as clocks and watches are concerned; that is one of the things referred to in connection with which there is a certain amount of extravagance, which was not mentioned in the original proposals. Then, a limitation is proposed in connection with velvets, velveteens, etc. We find that a lot of material is cheap in price; that it is used largely by people of small means, and that it is not entirely a luxury. We have fixed a price- in that respect; instead of making the whole of these articles taxable we merely s-ay that velvets, velveteens, plush and silk fabrics, selling at a price in excess of -$2 a yard, shall be taxable. Then, instead of all lace and braid being taxable, we say that only lace and braid in excess of 25 cents a yard -shall be taxable, .and ribbon in excess of 50 cents a yard.
A great many representations have been made in connection with carpets. We have had a fairly thorough investigation made since the Budget was brought down as to the cost of carpet materials, the actual cost of manufacture and the actual prices paid, and we propose to double the minimum in that case. The former figure wa-s $3 a yard, we now propose to make that figure $6.


William Daum Euler: Is the minister abandoning entirely the principle enunciated in the Budget Speech that the tax is to be on the whole price of the article, and providing that it shall be only on amounts in excess of certain figures?


Henry Lumley Drayton: The tax there is to be on the whole price of the article.


William Daum Euler: In only one or two instances are the taxes to be paid on the excess only?


Henry Lumley Drayton: Just in the few instances that I have mentioned.


Michael Clark: In cases
where purchasers have already paid taxes on the whole purchase price of some of these articles, will there be a possibility of getting a refund?	.


Henry Lumley Drayton: I hope that they will all be refunded; we will see to that if we can. Then, the same reasons which led us to increase the minimum in respect of carpets have led us also to decrease the tax on oriental rugs to 15 per cent.
There was nothing in the original resolutions with regard to extravagant furniture. The suggestion made in that regard is as follows:
A tax of 15 per cent on all antique furniture, of walnut, mahogany, ro-sewood, ebony, primavera, or oak; carved ebony or teak -wood and lacquered furniture; all furniture finished in gold- leaf, vemi martin or with ornamental or expensive inlay such as mother of pearl or hand-painted decorations. All tables made specially for cards, checkers, chess or other games; all liquor cabinets, smokers' cabinets, tea-wagons, sewing cabinets, work tables, piano lamps or stands, table lamps or stands, ferneries jardinieres, pedestals and bric-a-brac made of rosewood, primavera, solid mahogany or ebony, or lacquered or decorated.
You will see that all the cheap forms of furniture in that list are left out; only upon the expensive woods is there any tax.


Mr. DOUGLAS (Strathcona):: Will that apply to auction sales?


Henry Lumley Drayton: The resolutions are not drawn to apply to auction sales. Perhaps that is something that we should cover.


Henri Sévérin Béland: Do I understand that the tax will apply to veneered furniture of rosewood, mahogany, and so on?


Henry Lumley Drayton: I should think it would depend upon how much rosewood, and so on, there was in it. Personally I think that expensive veneered furniture ought to be included. Any one who can afford to buy a rosewood table, whether it is veneered or solid, ought to pay . the tax.
Then another thing was changed. We had no tax on expensive china and crockery; such a tax is now proposed.


Joseph Philippe Baby Casgrain: Our suggestion.


Henry Lumley Drayton: The hon. member will see that -we are serious in asking for suggestions; I ho-pe that hon, gentlemen opposite are as serious in making them as we are in adopting them.


Joseph Philippe Baby Casgrain: We want to get credit for it.


Henry Lumley Drayton: There are other minor changes, but I have said enough to answer the question of the hon. member for

South Renfrew, and to make it perfectly clear that we are sincere in asking for suggestions and in our desire to meet any difficulties that have arisen.


Mr. RINFRET:: May I ask the minister whether this new Budget, if I may call it so, is to take effect immediately, as is usual with Budget resolutions, or only when a Bill with regard thereto is introduced and passed? Or will these taxes be retroactive? I am simply asking for information.


Henry Lumley Drayton: I do not think we can make them retroactive. So far as any new things are concerned-and there are not very many-I take it that they will become effective upon a measure in regard thereto 'being introduced in the House.


Henri Sévérin Béland: To-morrow these changes now proposed will be in force throughout the country?


Henry Lumley Drayton: No.


Henri Sévérin Béland: By what are the retail merchants thoughout the country to be guided to-morrow?


Henry Lumley Drayton: By the resolutions already tabled.


Henri Sévérin Béland: How are retailers in general to know what these resolutions are?


Henry Lumley Drayton: Through the
public press; it is quite impossible to get information to every retailer in any other way.	[DOT]
There is no idea of being unfair with anybody; just as soon as we get our resolutions confirmed we intend to issue regulations of the plainest possible character so that every one will understand exactly what the position is. We ought not to be unfair to any one. We desire to be more than fair to everybody, but at the same time we ought to be very vigilant to punish direct cases of deception.


John Best: I understood that the question before the committee was whether the taxes should be collected through the retailer or through the wholesaler. I hope we shall have that question settled to-night. I do not see what that has to do with the different levies that are to be put on the various articles. I believe that the minister is making an honest effort to raise as much revenue as possible with a minimum of injury to the poor and middle classes, and I will say, having gone home and travelled on the trains, and having been in a. few towns, I am satisfied that there has not 212 '
been any measure in the last five years that has done as much to reduce the cost of living as the present Budget. When hon. gentlemen opposite say that boots and shoes and clothing have not been reduced since the Budget was brought down I think they are making a great mistake. Retailers have told me that the boots which previously sold at $10 have gone down to $7.50 and those Which sold for $12 are now selling at $9.	1 am now wearing a pair of boots-I
am not talking about ladies' shoes-to my personal knowledge they were selling before at $10, and I paid $7.50 for them. I believe that many of the retailers throughout the country have been charging too much, and this will be the means of bringing down prices. I think that the majority of the retailers of Canada are honest; of course, there are a few exceptions, and I do not want to see anything done that will make the honest merchant dishonest; there are a few dishonest ones in different places. Let me give an example of what I am afraid may happen if the taxes are collected through the retailer. A purchaser went into a store in our own village to buy a suit of clothes. The merchant asked $50 and the customer was perfectly satisfied, but the moment he was told that there was a government tax of $5 on the suit he refused to take it. He went to another store and bought a suit of clothes but did not pay the percentage. That honest merchant that tried to carry out the law to the letter was losing a customer and there was a temptation for him to do with his other customers just as the other merchant had done. I am told that a merchant in thie city, when a lady went to buy a pair of boots for $12, informed her that the tax amounted to $1.20 and upon her refusing to take the boots he said that he would fix the matter. He gave her a bill for one pair of boots at $8 and a bill for another pair at $4, thereby defeating the Government. I realize that there are millions of dollars of goods in the retailers' hands throughout 'Canada today, but I believe that if the tax were put on the wholesaler and the manufacturer, at the end of twelve months the Government would have received very much more revenue than they would by putting it on the retailer. I asked a ^hoe manufacturer last week how many customers he had and he told me he had between twelve hundred and thirteen hundred. Just imagine thirteen hundred retailers 'sending in little statements to the Government every two weeks1, and you will realize the objection to this method of collecting the tax. On


Henri Sévérin Béland: One for every store.


John Best: 
William Stewart Loggie: There are two, and only two, ways in which we can collect the taxes. One way has been supported by the hon. gentleman (Mr. Best) who has just taken his seat. If luxuries are imported you can put a luxury tax on them and pay through the custom house. Then they just collect from the consumer through the ordinary channels . The excise t ax may be placed on a luxury of domestic make and it also is collected through the ordinary channels.
I want to say a word in favour of the position of the minister. If T import goods that come under the luxury tax of ten per cent on which I have to pay $1,000, that $1,000 is locked up goods on the shelves of my store, and when I sell these goods to the consuming public I get a profit on my $1,000. I cannot afford to wrait for six months to turn those goods into cash unless I make a profit on my $1,000. By that method of collecting the tax the consumer must necessarily pay a profit on what the Government receives in the way of taxation. The object of introducing the mode of taxation that the minister proposes is to free the customer from the necessity of paying a profit on the tax. If I import the same value of luxury goods as in the other case, put them on my shelves and sell only fifty per cent of them within a year, I do not have to invest in the luxury tax until I sell the goods, and therefore I can afford to collect the tax for the Government without any extra profit because I have not made any investment in the meantime. But if I make an investment

it is certainly reasonable that I should get a decent- pro-fit on the money invested. There is a distinct advantage in the proposal of the minister.
Another object of collecting the tax in the manner the minister proposes is that- you impress upon- the 'buying public that if they buy an expensive article, something we will s-ay that some rich person can purchase, they are paying a direct luxury tax to help to defray the w'ar expenditure. You are impressing upon the people the importance of buying less expensive goods and so reducing the use of goods which are called luxuries.
To me, M-r. Chairman, there are but two ways of collecting these taxes. If I were asked which of the two ll would prefer to avoid friction, I would say by all means collect them through the custom house on imports and by excise from the manufacturer. But that must increase the cost to the consumer and the minister has told us that that is the reason for .introducing the resolution to provide that they shall ,be collected in the manner that he suggests. For that reason I feel I ought to support the minister in his proposition in the interest of the consuming public.
I want also to congratulate the minister on the changes he has made regarding clothing and boots and shoes. He now proposes to collect the tax on the amount in excess of the price named. While I have said that much, I want to draw the minister's attention to another phase of that question. You must remember we have what I would call two classes- of manufacturers- supplying the people of Canada with clothing. First of all you have the wholesale clothing manufacturers the bulk of whom make up a cheaper class of goods than perhaps the ordinary man in this Chamber wears. Then we have the other class of manufacturers known as the tailoring class. It strikes me that the tailoring class are hit to some extent in the resolution before the House. The manufacturing class will not come in for any tax whatever whereas the customs tailoring class. Let me read a statement showing what was done in the United States regarding the luxury tax on tailored garments :
Springfield, Ii.l., May 21.
To C. B. Lowe,
Chairman of practical work,
Merchant Tailors Association of Halifax, Halifax, N.S.
Merchant tailors pay no luxury tax on any thing they produce, except fancy vests, sold as such over five dollars. The original Bill in Congress provided a ten per cent tax on suits over 212*
fifty dollars, but by presenting our ease in Congress, it was stricken out as it was proved that tailors clothes was not a luxury.
L. A. Danner,
Secretary.
The Merchants Tailors Designers' Association of America.


Jacques Bureau: Is the maker of clothes to determine whether they are a luxury or not? He says they are not- a luxury because they are made by him. Does the hon. gentleman mean to say that the wholesale clothier who makes a suit- of clothes for $50 is manufacturing a luxury while the , tailor is not?


William Stewart Loggie: I was simply stating what thi-s writer representing the tailor's association alleged.


Jacques Bureau: The writer is off.	[DOT]
-Mr. LOGGIE: I am not raising the question- personally; I am only drawing the attention of the -minister to the fact that this class of garments was taxable on the proposals before the American Congress- but that as a result of the representations which were made, clothing made by tailors does not come under the luxury tax at all. It is just a question with me whether it is wise to have men's clothing - come within this class. However, the minister has made the proposal that we have only to pay on the excess over the minimum price named and therefore I do not think there will be the same feeling throughout the country regarding this tax as there was. I have not very much objection to it, and if we are to have a tax I do not see how we can do any better than collect it in the manner the minister proposes. Unless we are prepared to pay the distributing house or retailer a profit on his investment, surely there is no -better way, because no investment is made until the purchaser buys the article and pays the tax. The retailer is out no money. When he receives the money he puts it to credit in his -day-book, and pays it over to the department either every two weeks or every month.


John Best: What actual difference is there between the retailer holding that over and the purchaser paying the duty? When a purchaser buys goods and is required to pay the duty on them he has to pay that money down. In the case of the retadei he pays the percentage and must wait until he sells to get a return.


William Stewart Loggie: I quite agree with the hon. gentleman, but he must remember that any merchant who pays the duty and waits for

his money must get it back with profit from the consuming public. The duty is collected in this way, as I understand it, to avoid that profit.
Now, Mr. Chairman, I want to speak for a moment or two on the item:
Articles commonly or commercially known as jewellery, whether real or imitation, for personal use or for adornment of the person.
I have a letter here from tone of my constituents who lives in a small town containing a population of not less than a thousand people, and he puts the matter in this way:
To single out the jewellery trade for destruction is surely not a policy that you will endorse. The effect of the new taxation will be to drive purchasers of high-class jewellery to United States, where the tax is ony five per cent and where jewellery can be purchased more cheaply than in Canada.	-
I do not know what the luxury tax on jewellery in the United States is, but I do know that very much of the cheap jewellery that is sold in the country stores in Canada is imported from the adjoining republic under a fairly high ad valorem duty, and it does seem to me a very extreme rate to impose twenty per cent on top of that. I do think the minister might very well reconsider that rate.


Jacques Bureau: That is a luxury, a superluxury.


William Stewart Loggie: If you buy a fifteen or twenty per cent brooch, or cuff link, or something of that nature, it is not much of a luxury.


An hon. MEMBER:: What about an engagement ring?


William Stewart Loggie: 'If you buy an engagement ring it is a different matter.


Jacques Bureau: Tin is good enough these days.
Mr. LOG'GIE: I respectfully ask the minister to reconsider the rate he proposes charging on cheap jewellery. I have already explained that in the United States the rate is only five per cent. I have also explained that on most of the American-made jewellry that is bought in this country there is a stiff ad valorem duty. It seems to me that these articles are essential and the tax proposed here is increasing the cost of living unduly. I therefore hope the minister will reconsider the rate of duty imposed on cheap jewellery. With that hope I have put the matter frankly and fairly before him on behalf of my people.


Frank S. Cahill: I wish to make some suggestions to the minister and to ask him a question, seeing that he has asked for suggestions. First I would suggest that he have the schedule embodied in Hansard in the form in which he now has it so that it will be available in the morning for distribution to the members. My question is what will be the tax to-morrow tlo the retailers? The minister proposes, under this new regulation, to tax only the surplus above a certain price, that is ten per cent on anything above $9. The regulations, apparently, are now being changed. That being so, 1 would like the minister to make it clear what the change is. The minister has asked for suggestions as to the possibility of getting taxes and reducing the high cost of living. I can make one suggestion to him that I think will iappeal to the majority of the people throughout Canada. In order to reduce the high cost of living and lower the cost of clothing and shoes I would take the tariff off. If the minister is not willing to do that let him reduce the duty very materially. Then, in order to obtain revenue, I would tax the wealthy people instead of the pooT. It is time the wealthy were paying their due share.


Georges Henri Boivin: I must remind the hon. member that he must not now enter upon a Budget debate and that the discussion must be strictly relevant to the resolution unuder consideration.


Frank S. Cahill: Can you tell me what resolution, together with amendments, is under consideration.


Georges Henri Boivin: The resolution with amendments under consideration is a resolution to amend the Special War Revenue Act of 1915, and to impose cextain excise or sales taxes on certain goods.


Frank S. Cahill: The minister asked for suggestions, Mr. Chairman.


Georges Henri Boivin: If the suggestions deal with the method of collection or any change in the amount of the taxes, or anything relevant to the resolution, they would be in order, 'but to enter into a tariff debate would surely not be permissible.
Mr. BUREAU; Here are the resolutions.


Some hon. MEMBERS:: Order.


Frank S. Cahill: I am only following strictly ailong the lines pursued by the minister. He has already included in these proposed resolutions new forms of taxation, and he has asked for suggestions, regarding

them. I am simply complying with his request. When I said that it was time to tax the rich I merely wanted to point to my hon. friend what he and the Government already know. That is, that $1,300,000,000 of tax-exempt bonds were placed in the bands of the friends of the Government whereas the man who is buying his clothing and shoes is not exempted from taxation in any way.


Henry Lumley Drayton: I can hardly think that the hon. member is serious in what he says. His remarks, of course, are made for a purpose. He says that tax-exempt bonds were distributed among the friends of the Government. He knows, and kno'ws very well, that one of the greatest aids in carrying on and in financing Canada's part in the war was the aid which wTas given by people irrespective of position and irrespective of taxes, and that one of the best-


Frank S. Cahill: In reply to the minister, let me say-


Some hon. MEMBERS:: Order.


Frank S. Cahill: Well, the minister interrupted me.


Some hon. MEMBERS:: Order.


Frank S. Cahill: I think I have the right to ask the minister a question.


Georges Henri Boivin: I must point out that only one horn, member can be in possession of the floor at one time. The minister has the floor and unless he is willing to make way for the hon. member for Pontiac (Mr. Cahill) the latter has no right to interrupt, not even far the purpose of putting a question.


Henry Lumley Drayton: I am inclined to think that both the hon. member and myself were out of order. I think his remark was entirely out of order, and my reply probably was also out of order; but I suppose that a remark out of order sometimes merits a reply, although only a partial one at that. Now, in connection with the question my hon. friend raises, we cannot of course to-night change the resolutions, and this discussion does not in any way affect the rate of taxation.


Frank S. Cahill: It only confuses it.


Henry Lumley Drayton: I do not think .so. I will make it as clear as my hon. .friend likes, Mr. Chairman. If he does not think what I have said is quite clear, let me repeat it: Nothing we have done tonight changes the present situation. I think
my hon. friend's suggestion that the list of changes mentioned should be given to Hansard to-night is excellent, and in view of that suggestion, and my previous determination, that will be done.
Perhaps I should make a further suggestion in view of the statement made by the hon. member for Cape Breton (Mr. McKenzie), that some time should be given for considering the proposed amendments. I would suggest that hon. members should have to-morrow for the purpose of looking over the list which will appear in to-day's Hansard, and that the resolutions be taken up again at eight o'clock to-morrow night. In the meantime I move that the committee rise and report progress.


William Stevens Fielding: I hope the hon. gentleman will not press his motion.


Henry Lumley Drayton: Not at all.


William Cameron Edwards: I have waited for some time in the hope that I might avail myself of the privilege so kindly afforded by the Finance Minister to make a few suggestions. He has gone pretty well over the list. I merely wish to ask him to give consideration to the item in regard to the proposed tax of 20 per cent upon "mechanical piano-players, graphophones, phonographs, talking machines, music boxes and records used in connection therewith or with any musical instrument." That is double the tax on pianos, and it is regardless of price. I think the hon. minister might very well take into consideration the fixing of a price above which these phonographs would be taxed. After all, the phonograph is the poor man's musical instrument, and there is a great deal to be said on behalf of it as an educative influence. I do not ask that these instruments be exempted entirely; but the cheaper instruments, it seems to me, might be exempted from taxation, and, following out the principle' laid down in other cases, a tax might be imposed on the very high-priced instruments, because phonographs can be bought at as high a price as pianos.


William Stevens Fielding: I would like to offer one or two suggestions to the minister and, perhaps, ask a question before the committee rises. First, let me say that I have a degree of sympathy that I am afraid the committee may not have with the view expressed by the hon. member for Northumberland (Mr. Loggie) in regard to jewelry. In a sense jewelry is a luxury. We might ask: Why do people want jewelry at all? But I think there are degrees of luxury, and

I am going to suggest for the consideration of the Minister of Finance whether he might not properly make a distinction between *different classes of jewelry. There is a cheap class of jewelry which lends itself to personal adornment, and I do not think it should be deemed an extravagance if the young ladies of Canada want to adorn their beauty-although beauty unadorned is adorned the most-but if they see fit to add .to their charms with a bit of inexpensive jewelry, I do not think we should regard it as a crime. It seems to me that the minister might very properly make a distinction between the several classes of jewelry. Jewelry of an elaborate character is unquestionably a luxury, but jewelry of a simple character is certainly not a luxury. I would ask my hon. friend: Is a wedding ring a luxury?


Henry Lumley Drayton: I would say, "No',' at once to that question.


An hon. MEMBER:: Sometimes it is.


William Stevens Fielding: Then I hope my hon. friend will draw the line between the two classes. Make expensive necklaces dutiable, but distinguish in favour of the cheaper articles of jewellery. There is another thought in the matter, and that is that a large portion of our trading community are entitled to consideration, and even in the good cause of trying to raise money, although we all ought to appreciate the difficulties the Government has to face, we must be careful that lots of our traders are not driven out of 'business. All over the country there are scores of people doing *a moderate jewellery business, and as the hon. member from Northumberland has pointed out, they have already paid a stiff duty on the importation of their stock; and if we are going to add another stiff duty on the Tetail price, we are going to make their wares so expensive as practically to ruin their trade. I am not suggesting that jewellery be exempt from taxation, but rather that a distinction should be drawn between the cheaper and the more expensive articles. I think that is worthy of my hon. friend's consideration.
Might I ask a question: If a man sells a ship, does the buyer under this Act pay a tax?


Henry Lumley Drayton: I think ships are now exempt.


William Stevens Fielding: If my hon. friend is
clear on that point I do not wish to press it further. I have a communication from a shipbuilder who evidently has a different

impression. If my hon. friend has given the subject consideration, and says that ships are not to be taxed, I am content.
On the question of the mode of imposing these taxes, the argument advanced by the hon. member for Dufferin (Mr. Best) is enforced very strongly by a resolution, although I do not think it has been presented to the House, passed by la Chambre de 'Commerce, of Montreal. Let me read it to the committee:
Whereas it is desirable that taxes be economically and thoroughly collected and with the greatest facilities as to work and control, la Chambre de Commerce respectfully suggests to the Minister of Finance that the taxes on sales by manufacturers, wholesalers or on importations, be levied only at sources: at the Customs for imported articles, and from the manufacturers for domestic goods.
The hon. member for Northumberland has argued against that on the ground that the retailer pays this tax only at the moment the transaction is completed, and that there is a saving of interest in that way. But is there not a danger under the present system-and I am only offering this as a suggestion-that the tax will be paid two or three times? Take, for example, the first item in the list, boots and shoes. The manufacturer sells to the wholesaler, and the tax is paid. The wholesaler certainly is not going to be content to pay that tax without recouping himself, and he will add it to the price he charges the retailer. The retailer, in turn, will pass it on to the consumer, and in that way the tax will be paid two and perhaps three times. There may be strong' reasons against this suggestion of the Montreal Chambre de Commerce, but I am bound to say that I have not yet heard them. It seems to me there is very much to foe said in favour of imposing the tax at one stage and leaving the rest to be worked out in a natural way. I am only desirous of drawing this to the attention of the minister and I am content to leave it to his judgment.


Isaac Ellis Pedlow: I have been waiting for a considerable length of time to say a few words at this stage of the discussion. Several members made the claim that the Budget is responsible for current retail price reductions. Now, as hon. gentlemen who have spoken on this subject to-night have given their impression of the situation from hearsay evidence, possibly the committee to-night will permit me, as one who has had considerable experience and can speak from inside information on the subject as to the real application of this tax, to say a few words on the matter. These gentlemen

might just as well claim that the price reductions that obtained in the months of November, December and January last were induced by the Budget announcement on the 18th of this month as to claim that the reductions made during the past two- weeks, concurrent with the announcement of the Budget proposals, .were made on account of those proposals. Any one who knows even the A, B, C of retail merchandising, either in this country or elsewhere, knows that there are times in the life of any business concern when, for many various reasons, it is absolutely necessary to unload merchandise. This is made necessary from month to month and from year to year. A merchant may be optimistic and his buyers may be even more so than he is. They go to the market months before the merchandise is required for distribution and place their orders. This merchandise is purchased with the idea that the coming season will be normal, and consequently the distribution of merchandise will also be normal. During the past season, no doubt, buyers everywhere purchased merchandise with the expectation of having normal conditions of weather. They bought heavily of a certain kind of boots, a certain kind of ladies suits, dresses, coats and so on, expecting to have a normal, season in the months of March, April and the early part of May. I need not remind the committee that we did not have normal weather during those months of this year, and consequently merchants throughout the country were left with stocks loaded on their shelves. As a result of that condition, in order to unload the merchandise before the season had completely passed, they were forced to put that merchandise on their counters at reduced pjiees. That is the absolute reason for the general price reductions. No doubt there are exceptional oases such as those referred to by the hon. member for North Oxford (Mr. -Nesbitt) and the hon. member for Dufferin (Mr. Best). Those exceptional cases are liable to be found at any season of the year and in any year. I do not need to speak from hearsay; I have known of many instances where people in Toronto bought boots at a certain store in the early part of the week and during the subsequent days of the week they found those same boots were advertised at reduced prices for sale on Friday as bargain day. They took the boots back to the store, got their money on Thursday and went back and purchased the boots on Friday at a lower price than they had bought them at earlier in the week. This was not because of any Budget- announcement or
any influence the Budget exerted on market conditions; these are normal conditions from week to week the year round.
A great deal of discussion has taken place in the press, not only of Canada, but of the United States, on the same subject, Hon. gentlemen who have already referred to this Budget as being responsible for price reductions that have been current during the past two weeks might as well say that the Budget announcement in this Parliament was responsible for price reductions in the United States. For instance, a large concern-I will not mention the name, but it will occur at once to any one who has visited Washington or New York-instituted a horizontal or flat price reduction of 20 per cent on everything contained in their warehouse from the topmost storey down to the basement. I ask hon. gentlemen who have referred to the matter-do they claim that the Budget announcement made in this Parliament last week was responsible for the price reductions in Washington and New York? It is absurd to think of such a thing. Those reductions are the normal, regular, legitimate outcome of market conditions that obtain, and the Budget has no more to do with such price reductions than the man in the moon.
The hon. member for Dufferin (Mr. Best) intimated that in his constituency there were good merchants and bad merchants. I hope the committee will pardon me if I admit the possibility of that; but are there not, in all classes, professions, businesses and callings, good citizens and some bad ones too? That is a contingency that is admitted, and it cannot be avoided in any class of the community.	.
I do not wish to delay the committee very long at this juncture; but I might remind the committee that the country is at present face to face with an enormous obligation, and the money must he raised to meet that obligation. The Minister of Finance has decided on a certain method of collecting these taxes. It does not meet with my approval and I would suggest some other method, but he is the man in charge of the ship and he is responsible. It is true we can criticise the method, but he has determined to adopt that method and to push it through to a conclusion. I claim, therefore, that it is the duty of this committee to assist him in framing the resolutions and schedules along the best possible workable lines, and I am willing to give him all the information that it is possible for me, with the technical knowledge I possess in that connection, to render.

It has come to a ease of "put up or shut up." We have to raise the money, and if the Minister of Finance has decided that that is the best way in which to raise it, we have no alternative but to submit and try it out. We can criticise or object; but I do not think our objections will amount to very much, because the majority behind the minister will carry the proposals in any ease. Therefore, it is for us to try to adjust the matter along the best possible lines. I know that, as a matter of fact, the retail merchants of this country are, to a man, willing to help the Government in every possible way, not only in adjusting these schedules, but in collecting the revenue. Doubtless this will mean a large expense on them and on the Government under the method adopted by the minister of collecting the revenue. I should like to persuade him to try another method, but I understand that is impossible. I have here a resolution which was presented to the minister by the Eetail Merchants' Association on the 21st May last in the city of Ottawa. I will read just the concluding paragraph which expresses in a nutshell the attitude of the retail merchants of the Dominion. I might add that there were over 200 retail merchants present at Ottawa on the occasion on which this resolution was presented to the minister. The concluding paragraph reads:
We desire in placing our views before you to say that we fully appreciate the many difficulties under which the Government is labouring, but, as Retail Merchants we desire to offer our services, through our Association, in any manner whatsoever whereby we can give to the Government all the information and assistance that may be required regarding the Retail Trade in Canada.
While preserving the right to criticise schedules when finally printed and presented to the committee, I have very much pleasure in offering whatever assistance I can render to the minister, from my technical and personal knowledge of the matter, in framing and completing the schedules to the satisfaction of the committee and the country.


William Foster Cockshutt: The minister stated that he is prepared to receive suggestions, and it seems to me that now is the time to make them, in order that he may take them into consideration between now and to-morrow when he comes down with his new proposals in concrete form.
The most important point that has been raised to-night is that with regard to the means by which this taxation is to be col-

lected. I was a merchant for thirty years, -though I am generally accused of being a bloated manufacturer-and I know a little about merchandise. The suggestion of the member for Algoma East (Mr. Nicholson) should receive serious consideration. The minister will avoid a peck of trouble if instead of collecting this tax from 200,000 merchants in Canada he collects it from the wholesaler, the manufacturer and the jobber. I make that suggestion only as a business man. I want to co-operate with the minister, but I want him to think seriously of what has been suggested in this regard. To collect from the fountain head-the wholesaler, manufacturer and jobber- would be cheaper; would be a more business-like method of procedure, and would bring about actual results within the shortest possible time. Now, it has been intimated that the luxury tax is supposed to have the effect of reducing the cost of living, and that we lose that advantage if we cause it to be paid by the wholesaler, manufacturer or jobber. But if it is going to reduce the cost of living in such a way as to bring the prices down below the figures which are taxable, the minister will not get the revenue that he needs. It has been argued that the imposition of these taxes has brought down the prices of several commodities; if so, these commodities are not going to be reached by this luxury tax. But if the tax is paid by the wholesaler, they will be reached. If, therefore, the Government wants to avoid trouble, if it wants to get the quickest and best results, it should have this tax paid at the fountain head of supply, and paid only once; for if you do not do that you are going to have the tax passed down the line; there will be one, two, or three collections on the same goods if we are not careful. Then, another serious aspect of the matter is the opportunity which exists, under the method of collection as proposed, for avoiding the tax. If there are any dishonourable merchants-though I believe there are very few-there is room for evasion of the tax. For instance, a suit which sells at ?45 is taxed, but if the coat is sold to-day and the rest of the suit a week hence, the tax may be avoided. What is the position of the retailer? Twenty-five or fifty per cent of the merchandise sold in Canada is sold on credit; from ten to twenty per cent of it, perhaps more, is sold over the telephone. The retailer becomes responsible for the tax the moment the sale is made. He not only gives credit on his goods; he has to guarantee to the

Government that the tax on those goods is going to be collected. It goes down on his books. Some of it will never be collected. Well then, the result is that the merchant is liable to be out of pocket not only in respect of the goods, but in respect of the tax on the goods. But he is not permitted to put any profit upon the tax, even though it goes on his books and stays there, perhaps, for thirty, sixty or ninety days. I submit that that is not fair to the merchant. When I was in business 1 gave six months' credit to many farmers; accounts were rarely paid within three months. So that the merchant becomes responsible for the tax whether or not he collects it from the customers. The minister will be well advised to avoid this very serious difficulty.
I have only one or two other suggestions to make. The Brantford merchants have sent me a telegram which is in line with what the minister has proposed,-that is, they ask that the tax be paid on the excess, not on the whole value of the goods; they propose also that the tax be increased in that respect, and that a one per cenit tax on all sales be imposed. I do not vouch for the soundness of that suggestion; I do not know whether it is practicable, or even in line with what I have suggested. Then, there is the matter of electric fixtures. The minister has taken into consideration several items that are to be changed. I submit that electric fixtures are a necessity in the homes of workmen in our cities to-day. Surely an electric fixture with two bulbs on it cannot be called a luxury; ye^ if such a fixture costs $5 there is a 20 per cent tax on it, which adds another dollar to the cost. Having regard to the high cost of building and of all kinds of materials that go into the construction of houses, I ask that the minister consider this matter of electric fixtures. I do not ask him to exempt the fancy chandeliers that cost anywhere from $50 to $1,000, but I do say that the cheap chandelier costing from $5 to $10, that is necessary in every workingman's hou e where electric lighting is used, is not a luxury. The matter of furs should be considered; I believe that the minister is doing something in that regard. I have several protests also with regard to the present proposals affecting jewellery. But all these matters are of minor importance compared with the necessity of devising some better way of collecting these taxes. I repeat that the minister and the Gov>-ernment will be well advised if they have these taxes paid by the wholesaler, manufacturer or jobber.
Mr. BEiLAND:	On no occasion have I
listened with greater pleasure and gratification to my hon. friend from Brantford (Mr. Gockshutt) than I have this evening, because I find that for the first time I am able to agree with him on an economic subject. I entirely agree that these taxes should be collected from the wholesale trade. I assure the minister that the criticism that comes from hon. members on this side is criticism of a constructive nature. I have listened with close attention to the statement of the proposed alterations in the resolution submitted a few days ago by the minister. I failed to observe any proposed change with regard to medical supplies for hospitals.
'Sir HENRY DRAYTON:	There is a
change in that respect.
Mr. BEiLAND: Well, I am glad (there is. I know that the minister has received delegations from the hospitals. It would be a great hardship if the cost of medicines to the hospitals were increased by these taxes. Now, I desire to obtain some information in regard to a particular subject. Some people are in the habit of procuring their clothes in a different way from that ordinarily adopted by most people. They buy the cloth separately from a dealer and pay, let us say, $30 for the tweed or whatever it may be. They then pay $20 to a tailor to make the suit, making the total cost $50. I wonder if a man who gets a suit of clothes in that way is subject to taxation and in what manner the minister proposes to collect the tax from him. I should also like to know whether ham and bacon as subject to taxation.


Henry Lumley Drayton: They are not
taxable; they are foodstuffs,


Henri Sévérin Béland: I ask the question because it was stated in some newspapers that they were taxable, II wondered at the statement, because I knew that all food was supposed to be free from taxation. Now, Mr. Chairman, that is all I propose to say. Let us be short, and sweet if possible.


Jacques Bureau: Suave.
Mr. -NESBITT:	Before the -Committee
rises I want to say a few words with reference to the mode of -collection. My hon. friend from Brantford said that the ordinary merchant had to charge to a eertain extent the goods he sold and therefore he would have to charge not only the price of the goods but the amount of the dhty, and he therefore wanted to collect through the

wholesaler or manufacturer. 1 should like to know if he would not have to pay the wholesaler or manufacturer the price that he would have to charge, and if he would not have to charge that just the same as though he added it to the price in his store.


William Foster Cockshutt: He gets a profit in one case and not in the other.


Edward Walter Nesbitt: My hon. friend says he
will get a profit in one case and not in the other. That is exactly what the minister wants to avoid. Not only would he have to pay the profit in one case but he would pay a pyramid of profits. That is to say, he would pay a profit to t'he manufacturer and pay a profit on that profit to the wholesaler. He would pay two profits, one to the manufacturer and one to the wholesaler, and besides, there would .foe lost the very excellent result that the person purchasing would know exactly what duty he was paying so that he would be careful the next time to buy goods that were cheaper and by that means lower the cost of living not only to himself but, by the influence it would have on others, to his neighbours as well. As to the cost of collecting the tax, I have not much hesitation in saying that the cost to the Government would be less through the manufacturer and wholesaler. I have not much doubt about that. I do not know exactly how the minister proposes to collect the taxes through the retailer, but he has hold us that it will be through the Inland Revenue Department. (Let me say that the suggestion that has been thrown out by a good many members to-night that it would materially add to the expenses of the retailer to keep track of this tax Is purely imaginary and is offered for the express purpose of trying to shift the responsibility to someone else instead of the retailer.


William Foster Cockshutt: That is not right.


Edward Walter Nesbitt: Well, I have had all
sorts of petitions from retailers who want to avoid it. Every one wants to avoid paying taxes if he can, and I have no doubt, that there is a similar anxiety on the part, of most people to avoid being made the instruments by means of which the tax shall be collected. But as to the excessive cost to which the retailer will be put, that is purely imaginary. Nowadays every retail business in Canada gives a counter slip to the purchaser. It is proposed, as I understand it, to enter the duty separate from the cost of the goods on the counter slip, and any girl in two hours could add up

the sales of an ordinary establishment of $1,000 a day. There would be a column for the tax and a column for the price of the goods, and that I imagine will foe invented almost immediately by almost all retailers if they have not got it already; and any ordinary young girl who is smart and quick would be able to add that sales book in two hours. iSo that there is no earthly necessity for any one to hire an extra clerk if he is doing a reasonable amount of business in a day. As to the ordinary country merchant, he also nowadays gives counter slips, and if hd is doing a business of $100 a day it will not take him fifteen minutes to add up at night the amount of tax that goes with those sales. He would have no necessity whatever to employ extra help to do that.


Henri Sévérin Béland: I do not agree with you.


Edward Walter Nesbitt: I am not in the retail
business at the present time, but I was in it for several years and I know what I am' talking about. From experience, I can tell you that what I have said is absolutely correct; it will not necessairly add to an ordinary retail business $5 a year of excess cost.


William Foster Cockshutt: Nonsense!


Edward Walter Nesbitt: There is no nonsense
about it.


Henri Sévérin Béland: It is a long time since you were in the retail business.
Mr. NESBITT; Any merchant who does a thousand dollars and upwards of business in a day keeps a clerk purposely to check these sales. Go into any store in Ottawa and you will find in the cash desk a girl who checks these bills passed in from the sales clerk. She checks those bills and adds them in her sales book, and if she has a tax column she can add that column at the same time. Every decent merchant in the country that does business of $500 a day keeps a sales book and at night it must balance with the cash that is turned in. I make this statement only because there were a good many on the other side who spoke on the subject, and I want the minister to take that into consideration at the same time that he is considering the statements made by my hon. friends that the tax should be collected through the manufacturer and wholesaler. It is all right to collect the sales tax through the manufacturer and the wholesaler. I was a strong advocate of the sales tax myself, but I thought it should stop at the mam-

facturer and the importer. It is doubled to a certain extent when it goes to the wholesaler, and I w'ould not want to see it go to the retailer, because that would be treble. It is proper to collect the turnover tax from the manufacturer and the wholesaler, but I believe that collecting the excess tax or the luxury tax, so-called, through the retailer is probably the very best system that could be adopted because of the results that will be obtained. That is a part of the cost of living. The hon. member for South Renfrew (Mr. Ped-low) suggested-and I have no doubt he is perfectly right-that the reduction in the price of boots was probably because there was a sale on that day. I only stated the fact exactly as I knew it, that it happened at the same* time as the Budget was announced. Nearly every witness that came before the committee that investigated the cost of living last year said that there was too much spread between the price that the merchant paid for boots and shoes and the price he sold them at. The average was sixty per cent, and that is too much profit in any retail business.


Henri-Edgar Lavigueur: Is it the intention to charge the 20 per cent on mechanical player pianos on the whole piano or on the player action alone, as before?


Henry Lumley Drayton: I have been
asked to give Hansard, for the benefit of hon. members, a list of the changes to be made in order that members may see what is proposed in tomorrow morning's Hansard. I have much pleasure in complying with the request that the list of the proposed changes, some of which may be the outcome of the suggestions we have received to-night, be published. I would therefore move:
That a list of the proposed changes be placed upon Hansard.


[Stage Direction]
Motion agreed to.
The list of suggested changes is as follows :
In the ease of boots and shoes, etc., clothing (men's and boys'), including coats, vests and pants, whether sold separately or together; women's and misses' dresses, skirts, suits, and coats, a change is proposed to be made by charging 15 per cent on the excess over the prices fixed instead of charging the 10 per cent on the whole value.
For the purpose of>
preventing the tax being evaded by the purchase of parts of suits or dresses, the cost exempt from taxation is fixed at $12 on trousers, $5 on waistcoats, and $25 on coats. In like manner the cost exempt from
taxation is fixed at $15, on skirts, except silk, and at $35 on women's coats, except silk.
Besides changing the tax on boots so that it applies only on the excess, it is also proposed to extend the exemptions to topboots not less than 12 inches in height, such as are used in lumbering, miming and fishing industries, and to river driving boots fitted with caulks on; the soles thereof.
It is proposed to raise the exempt value of fur coats from $100 to $200, and to reduce the exempt value of fur robes from $100 to $50. Under the original proposals the whole fur list, except coats and robes was placed in the 20 per cent class, and without any exemption. It is proposed to drop this provision and to make the following additions t*o the 10 per cent list (paragraph 1, sub-section (a)).
Gloves, the component material of chief value being fur, in excess of $15 per pair.
Caps, the component material of chief value being fur, in excess of $15 each.
Muffs and neckpieces, the component material of chief value being fur, in excess of $35 each.
Other wearing apparel, not otherwise specified, the component material of chief value being fur.
The following additions to the same list are suggested:
Corsets, in excess of $5.
Walking sticksi
Knitted sweaters and knitted sweater coats in excess of $15.
Ebony and imitation ivory toilet ware.
Note: Ebony and ivory toilet ware were included in the 20 per cent list. Ebony is struck out of that list and transferred to the 10 per cent list. Under custom® rulings imitation ivory being subject tio the same 20 per cent tax, imitation ivory is also placed specifically in the 10 per cent list
The item of plated ware in the 10 per cent list is proposed to be changed so as to confine the item to articles plated with gold or silver not otherwise provided for household or office use, as a result the tax is dropped on articles plated with nickels.
Clocks and watches in excess of $10 each are added, and the tax on velvet®, velveteens, plush silk and artificial silk fabrics applies to articles sold in excess of $2 a yard.
It is suggested to change the provision as to lace, including collars or collarettes and all manufactures of lace, and to provide a tax on braid, as follows:
Lace and braid in excess of 25 cents per yard ;
Collars and collarettes of lace and all manufactures of lace in excess of $ 1 per yard;
Ribbons of all kinds and materials, except typewriter ribbons, in excess of 50 cents per yard;
The changes proposed in the 20 per cent class, paragraph (a) sub-paragraph (b), are as follows :
As already noted, ebony toilet ware is carried into the 10 per cent class.
Fur wearing apparel n.o.p. is dropped.
The tax on oriental rugs is proposed to be reduced from 20 to 15 per cent.
It is proposed to take carpets from the 20 per cent list and provide for a 10 per cent tax on the amount paid for carpets and rugs in excess of $6 per lineal yard of 27 inches in width.
Articles usually sold by jewellers, covered by the different resolutions, are combined so as to
[Stage Direction]
fall within the 20 per cent list, with a limitation as to license,, as follow:
Cigar and cigarette holders and pipes in excess of $2.50 each; cigar and cigarette cases; ash trays and match boxes of gold or silver; humidors and smoking stands; hunting and bowie knives; gold and silver handled pocket knives and pencils, and gold fountain pens; gold, silver and ivory toilet ware; articles of silver not otherwise provided for in this resolution adapted for household or office use; silver or gold deposit ware; articles commonly or commercially known as jewellery, whether real or imitation, for personal use or for adornment of the person.
Any person, firm or corporation, including the jewellery branch of a departmental store whose chief business is the selling of jewellery by retail, shall obtain a special license to sell jewellery and other articles specified in this resolution, in which case the tax payable shall be 10 per centum on the value of the total sales of such establishment or branch, under regulations to be made by the Minister of Customs and Inland Revenue.
It is proposed to abandon the present tax on chandeliers at 20 per cent, and provide for a tax of 10 per cent to be paid by the manufacturer as in the case of articles falling under section 3 of the resolution as follows:
Chandeliers, except for churches, in excess of $12 each; wall brackets, in excess of $3 each; gas and electric light fixtures, in excess of $3 each; not elsewhere provided.
The changes proposed in paragraph 3 are as follows:	Confectionery which may be classed
as candy or a substitute for candy. A tax of 10 per cent on all candy, except in original packages and original labelled pieces, bearing the name of the manufacturer on the packages or labels, retailing for 10 cents or less; also confectionery described and known as "gross goods" as sold to children at one cent each. These exceptions not to apply to candy at any time when sold by the manufacturer in bulk.
On chewing gum or substitutes therefor, the tax is reduced from 10 to 3 per cent.
Further suggestions will be made later with reference to pianos, organs and other musical instruments.
It is proposed to increase the tax on automobiles adopted for passenger use, retailing at $3,000 each, from 15 to 20 per cent.
It is suggested that the tax on playing cards be changed as follows:
For every 54 cards, or a fraction of 54 in each package, when selling at $24 or less, per gross packages, U5 cents per pack. When selling in excess of $24 per gross packages, but not in excess of $36' per gross packages, 25 cents per pack. When selling in excess of $36 per gross packages, 50 cents per pack.
According to customs decisions, the resolutions providing for an increased tax of $2 per gallon on spirits, lime juice or fruit juices, tinctures and medicines, means a tax of $4 on lime juices, medicines and perfumes, as the tax is held to be cumulative. It is proposed that this tax shall not be cumulative; that there shall be only one advance on the present rates for the alcoholic contents in lime juices, patent medicines, etc., of $2 in place of $4.
A reduction is also proposed to be made on imported medicinal or medicated wines, vermouth and ginger wines, and patent proprietary medicines containing not more than 40 per cent of proof spirits, from 30 to 20 per cent.
Reductions are also proposed in connection with the sporting goods list. Under that list

at present, children's toys, games, etc., are exempt as are articles not over 50 cents in value. The exemptions are extented as follows so that the tax applies to baseball bats and baseballs in excess of $1.25 ; baseball masks and gloves in excess of $ 1.5-0; Skates in excess of $2.-0*0 a>
pair; toboggans and hand-sleds in excess of $3.00; footballs in excess of $3.00; lacrosse sticks in excess of $1.50 ; hockey stocks in excess of 75 cents.
It is proposed to abandon the present stamp taxes now collected on patent and proprietary medicines perfumery, etc.
Progress reported.

[Stage Direction]
On motion of Hon. Martin Burrell, (Minister of Customs and Inland Revenue) the House went into committee on the following proposed resolution, Mr. Boivin in the Chair:
Resolved, that it is expedient to amend the Post Office Act, chapter sixty-six of the Revised Statutes, 1906, and to provide,-
1.	That paragraph (k) of subsection one of section nine of the said Act be amended so as to provide that the maximum registration fee on letters and other matter passing by the mails shall be increased from five to ten cents for each letter or article.
2.	That section fifty-two of the said Act be amended so as to provide that the rate of postage on newspapers and periodical publications printed and published in Canada, and issued less frequently than at intervals of one month, and on all specimen newspapers, be increased from one cent to two cents for each pound weight, or any fraction of a pound weight.
3.	That subsections two and three of section fifty-three of the said Act, as amended by section five of chapter fifty-three of the statutes of 190<S, be repealed, and the following substituted therefor:-
"(2) Newspapers and periodicals required to be transmitted by mail within a distance of forty miles from the place of publication, the publication of which is of no greater frequency than once a week, which have a circulation by mail of not more than one thousand copies per issue, and which are published in any city, town or village which has a population of not more than five thousand persons, shall be transmitted free of postage within such area.
"(3) Newspapers and periodicals which are required to be transmitted for a greater distance than is mentioned in the last preceding subsebtion, or the publication of which is of greater frequency than once a week, shall be subject to postage at the rate of one cent on and after the first day of January, one thousand nine hundred and twenty-one, and until the first day of January, one thousand nine hundred and twenty-two, and one and one-half cents thereafter, for each pound weight or any fraction of a pound weight, and such postage shall be prepaid by postage stamps or otherwise as the Postmaster General from time to time directs."
4.	That sections seventy-five, seventy-six, seventy-nine and eighty-one of the said Act be repealed, and the following substituted therefor:
"75. All letters and other mailable matter sent by the Governor General or by any min-

ister or department of the Government at the seat of Government, shall be free of Canada postage under such regulations as are from time to time made in that respect by the Governor in Council; and the provisions of any other statute inconsistent with the provisions of this Act, or conferring any greater powers of sending or having sent mailable matter free of postage than are conferred by this Act, are hereby repealed.
"76. (1) Letters and other mailable matter sent by the Speaker or Clerk of the Senate or of the House of Commons at the seat of Government shall be free of Canada postage, and letters and other mailable matter sent by any member of either House at the seat of Government during any session of Parliament shall be free of Canada postage. Provided that. such letters relate wholly to the affairs of such member of the Senate or of the House of Commons Canada, or to official or public business of the Government of Canada, and that all such mailable matter other than letters in their usual and ordinary form relates wholly to the official or public business of the Government of Canada.
"(2) All letters posted for transmission under this section must be franked by the personally written signature of the member of the Senate or of the House of Commons sending the same. All mailable matter other than letters sent under this section may, however, be franked by the facsimile of the signature of such member as well as by his personally written signature.
"(3) If the signature or facsimile thereof of a member of the Senate or House of Commons be employed for the purpose of franking any letters or other mailable matter except those mentioned in the foregoing section, the person so improperly using it shall be liable to a penalty of three hundred dollars for each offence, to be recovered upon summary conviction.
"79. Members of either the Senate or the House of Commons may, during the recess of Parliament, send by mail, free of Canada postage, all papers printed by order of either House."
William Stevens Fielding: I suppose the minister will give a general statement of the purpose of the changes?


Mr. BURRELL:: In answer to my hon.
friend (Mr. Fielding) I may say that the resolutions practically explain themselves, and I presume that any lengthy discussion of them may perhaps better take place on the second reading of the Bill when it is introduced. But I will make a running comment on some of the sections. The first section is to alter that clause of the old Act which provides for a five-cent registration fee. It is proposed that ten cents shall be substituted. Last year there was a loss of something like a quarter of a million dollars on that portion of the postal service, and this year that will be seriously augmented by the fact that there is an increase in salariss and bonuses, etc., which would probably reach something like $1,500,000.


William Stevens Fielding: Will the hon. gentleman say what he means by a loss in the registration branch?


Martin Burrell: There was an actual loss of a quarter of a million dollars in carrying on that special branch of the service.


William Stevens Fielding: Is there any other expense beyond that of the extra clerk for registration in each office?


Martin Burrell: According to the return which I have here, the expense of 1918 was approximately three-quarters of a million dollars, the total revenue obtained from the fees collected from this service was approximately half a million dollars there being a loss as between revenue and expenditure to the Post Office Department in the administration of the registration system of approximately a quarter of a million. I am afraid I cannot explain at the present moment the details of the practical administration that would put the expenditure up to that figure. Those are the figures that are given to me as to the cost of administration and the revenue, and the loss entailed is something like a quarter of a million dollars. It was proposed therefore to put the fee up to ten cents which is the same as that in the United States and practically the same as in England, although England runs from a smaller figure up to as high, I believe, as forty cents according to the compensation. I might also add that this will be a benefit to, and will be welcomed by, the rural postmasters inasmuch as it will increase their basis of revenue and therefore increase their remuneration.
The next section provides that instead of one cent on papers published less often than once a month, that is quarterlies, and on specimen newspapers, the rate shall be raised from one cent to two cents a pound. I may say that this increase is largely for the purpose of getting a better revenue out of the very large number of specimen newspapers that are sent around through the country, and which are, in effect, a species of advertising by the paper for the purpose of getting new subscribers. I am not aware that there is any very logical objection to the proposed change.
The next section is that dealing with numbers 2 and 3; with the substitution first of all in number 2 of a rate on weekly newspapers which hitherto, within a radius of forty miles selected by the newspaper itself, were allowed to go free. It is proposed now that the centre of the forty-mile range shall be the place of publication. This was designed to overcome what was

previously open to criticism, a newspaper selecting its point in the forty miles between two large cities in Which case it could fake advantage of those two large cities. The object of this section when placed in the old Act was to encourage the very small weekly newspapers throughout the country, and certainly was not intended to be abused in the way I have suggested. Therefore it is proposed in the first place to make the forty miles start froim the actual place of publication, and for those papers that have a circulation of less than a thousand to go free and those over a thousand circulation to pay the same rate that an ordinary newspaper would pay, limiting also the place to a five thousand population to encourage- the* smaller newspapers and not to encourage in any way or to benefit those weekly newlspapers that are published in cities.


Mr. SINCLAIR (Guysborough):: Is the place of publication the place where a paper is printed? For example it is customary in certain parts of the country to have the paper printed at some distance from where the editor and the office of the paper are located. There are papers in the province from which I come that have no printing press hut they arrange with the press, perhaps a hundred miles away, to do the printing. The copy is sent to tthat place and the papers already printed are sent back and distributed from the point where the editor and proprietor happen to live. What would happen in such a case as that?


Martin Burrell: Well, I should think there could not be any doubt about it. It would be the place from which the newspapers are distributed, that is where the editorial rooms are, because under the old Act it is obvious they would not have got the advantage of free distribution, because the radius was forty miles. I assume that the point of distribution would be the place of publication.
The next clause is that which raises the rate of newspapers of more frequent publication than a week-that is of the daily and semi-weekly papers-from a quarter of a cent a ipoilnd up to a cent a pound, going into operation on January 1st next, and one cent and a half on the following January. I may say in regard to this that it wras to be half a cent in Canada some time ago, and for some reason, about which I am not quite clear, it was put down to a quarter of a cent. There are something like 87,000,000 pounds of news-

papers carried in this country at a quarter of a cent a pound constituting about fifty-four per cent of the total weight of mailable matter. The revenue derived from that quarter of a cent is about $290,000 whereas the total revenues are $25,000,000. That is to say, newspapers, which constitute fifty-four per cent of the total weight pay one per cent of the cost, and the department has estimated that it was losing well up towards $5,000,000 a year by carrying newspapers at a quarter of a cent a pound. They are actually out $2,000,000 in the cost of equipment and necessary material-the actual disbursements-and considering this and the different expenses in the way of salaries and other items they estimate that the loss would probably run up to $5,000,000.


Edward Walter Nesbitt: Does not the minister think it is a pretty big jump from a quarter of a cent a year until that one cent is arrived at? The newspapers are in trouble now owing to the price of newsprint and other reasons.


Martin Burrell: I need hardly tell my hon. friend that I hope I have sufficient sympathy with the point of view taken by the newspapers. I am quite aware that they feel their position very difficult at the present time in regard to the cost and difficulty of obtaining newsprint. I will admit that it seems a pretty big jump from a quarter of a cent to a cent- On the other hand I think it is only fair to point out to the House the fact that the Railway Commission has recently given the railways power to raise the rates on mailable matter; and if-as I have no doubt will happen-they raise their rates at least a hundred per cent, even if we made a raise of only half a ce'nt we would be still in exactly the same position that we are in to-day with respect to loss to the department. It should also be pointed out that one cent-even though it may seem big calculated in percentages-will be hopelessly inadequate compared with the expense of carrying the newspapers. Newspapers in United States, as a matter of fact, to-day are charged one and a half cents for their carriage, whereas we only propose to charge one cent. However, in respect to this- which I know is a very debatable matter; several members of the House have already spoken to me and said they would like to discuss it and put their remarks on record -I would -suggest that the subject can be very well discussed at greater length when the second reading of the Bill takes place,

and as to any suggestions the Government, of course, will give consideration whatever may or may not be done.


Peter McGibbon: Is there any legitimate reason in the public interest why all newspapers should not pay the actual expense of transportation? Why should not newspapers, even under a thousand circulation, pay for their carriage and let them charge that cost up to circulation?


Martin Burrell: I have no doubt there are other hon. members who could answer that question. Of course the view of the Post Office Department generally would be, putting it as a matter of principle, that all service should pay for itself. If we did it in this particular case the newspapers would certainly have to pay a vastly bigger rate of increase than we have even suggested. Of course it is not up to that rate now. Then, one is bound to point out that conditions are somewhat different from what they are in the United States, on account of the enormous stretch of country in Canada and the comparative sparsity of the population. I suppose, too, it would be urged by the newspapers that a newspaper is almost regarded as an absolute necessity and as a great educationl factor; and to charge to the extent that my hon. friend suggests would practically, I have no doubt, put a very large percentage of the newspapers of the country absolutely out of business.


Peter McGibbon: Not if they increased their rates. It is a matter of business.


Martin Burrell: Yes. It. is a matter of business.


Joseph Elijah Armstrong: Would it not be possible for the minister, before the second reading of the Bill takes place, to consider the advisability of increasing the distribution from one thousand to two thousand? Perhaps in the western provinces the proposition might meet with the general approval of a large number of the weekly papers, but when you come to the older provinces like Ontario and Quebec you will find that the bulk of the weekly papers have a circulation of from 1,500 to 2,000, and many even more than that. I certainly think the suggestion is worthy of the serious consideration of the minister. I would also call his attention to the fact that he is now increasing the rate on the other weekly papers and magazines, not one hundred per cent, but four hundred per cent. That is a tremendous jump to make, and
I would ask if it is not possible to consider a more reasonable increase at present.


Pius Michaud: Before the minister
makes his reply I would like to read a statement which I have received from the Graphic Limited, a newspaper published at Campbellton, N.B. The letter is from Mr. H. B. Anslow:
We ask you to press for the substitution of the following for the above section:
"(2) Local weekly newspapers which have a circulation outside their own town or village of not more than 2,'00'0 copies each week, shall be transmitted by mail free of postage within a distance of forty miles of office of publication."
I understand that under the resolution only 1,000 copies are allowed to be distributed. The writer of this letter adds:
The lot of the weekly publisher is yearly becoming more difficult, until many of us will be crowded out and much good work being done by this class of papers will be lost to the Dominion.	[DOT]
I am advised that the publisher of this newspaper will have to close down his business if he is not allowed the higher circulation.


Rodolphe Lemieux: I shall await the Bill as printed before discussing at any length the subject matter involved in this resolution. But at this stage I wish to state that if the Post Office is in need of a larger revenue there are other means than the present one which might be found to achieve that result. Let me say at once, Mr. Chairman, that the Post Office Department before 1896 was an institution not worthy of the time as regards business methods, and huge deficits followed in succession year after year. But when Sir William Mulock took charge he introduced business methods, and we all know with what result. I may say that in his day he thought of establishing the zone system in order to prevent what were merely advertising agencies benefiting by the low rate of newspaper postage. However, he finally concluded that we might perhaps continue the system, but he cut down the waste as much as possible, and succeeded to such an extent that the department soon became conspicuous as a place where sound business methods were practised. I claim no merit when I say that I followed in the footsteps of Sir William Mulock, and that year after year we had surpluses instead of deficits.' We established, I think, a fair rate of postage on newspapers and magazines, and I gave a preference to British magazines and newspapers by barring out the yellow press and yellow magazines from the neighbouring re-

public. I am sorry to say that that system which gave so much benefit to our settlers in the West was abandoned somewhere round 1912. Now, in order to provide more revenue for the Treasury my hon. friend comes before this committee and proposes to materially increase the revenue of the department by cutting down the privileges of the press and by establishing the zone system. If he wishes to get more revenue I would advise him to chop off the heads of useless officers in that top-heavy staff which he has in the various post offices. The population of Canada has not. increased so materially in the past ten years that in cities, for instance, like Quebec the post office staff should be increased from 90 to over 300. In the city of Montreal the post office staff in 1911 was something like 700; I am informed that to-day it numbers over 2,000. I make bold to say, Mr. Chairman, that at least 200 of those employees in the Quebec ofiice could be discharged, and at least 2,000 at the Montreal post office. I am not speaking of Halifax, or of Toronto, or of Winnipeg, but I daresay that there the same wasteful system has been established by the administration of the department.
But this is beside the mark. We are speaking of the new methods which it has been thought wise to introduce in order to increase the revenue. I have no love to waste on the press of Canada, as members of this committee know; but I put my grievances aside and I stand here this evening as an opponent of any tax on freedom of thought. You can tax my shoes, you can tax my vestments, you can tax my investments.-if perchance I have any,-you can tax almost anything I possess; but, Mr. Chairman, do not tax freedom of thought in this country,-and that is what is being done under this proposal. And besides, you are making no distinction between a real newspaper and a sheet which under the name of newspaper does not convey news, does not disseminate ideas, but is merely a medium for certain fortunate firms who are investing their excess profits in advertising their wares extensively before the public. Let me read the protest of a young Canadian author on this subject. It appeared in Saturday Night some days ago and is as follows:
I wish somebody would explain just why the Government of this Dominion is so intent on playing Herod to those luckless infants of arts and letters which lie within reach of its broadsword. At a time when Canada is struggling to express herself through her own distinctively Canadian periodicals, and is doing her youthful 
best to become something more than what the botanists might term an "obligate parasite" on tiie United States, it seems doubly unfortunate that the life of many of our native .publications should be nipped out by a Postal Zone Bill which carries the threat of an increase of 400 per cent.
As my hon. friend from Lambton has just said:
-in mailing charges within a distributing range of 300 miles, and an increase of at least 800 per cent for still wider areas of distribution.
You have there in a few pointed sentences the effect of this legislation which is introduced this evening. You are increasing by 400 per cent and in some cases by 800 per cent your tax on the press of Canada. He continues:
We want to be something more than a backdoor neighbour of Uncle Sam. We want a voice of our own, and a literature of our own. To have these we must have those publications which remain less involved with the crowded events of the hour than is the daily press. Our authors have survived, it is true, without the protection of that respectable copyright legislation which. most countries extend to toilers in the garden of the imagination. They may even survive a cutting down of their home market. But postal impositions which tend to restrict the disseminations of thought to merely sectional dimensions is retrogressive, and .governmental economies which are bound [DOT]to hamper the diffusion of culture are going to prove repugnant to the open-minded Canadian. It may cost a little more in the bulking up of budgets to encourage our magazines instead of sabering them. But they are trying to make themselves worth the cost. And in the end it is money well spent-as our older and wiser neighbour to the south of us discovered before she went through her own low .fever of postal reform.
Arthur Stringer.
Let us put the question on a higher plane, if I may so express myself. This country extends from ocean to ocean. We have been told repeatedly in years gone by that our business is from East to West and from West to East, not from North to South. We have been told that we should be satisfied with interchange of commerce between the various provinces of this Dominion; we have been told that what we need most is a healthy national sentiment from the Pacific to the Atlantic and from the Atlantic to the Pacific. That is a sound p'licy. We must build a Canada in which the man from the East will, on broad issues, think alike with the man from the West. There must be interchange of ideas between those distant provinces. What are you doing by this legislation? By this postal rate you are preventing the hon. member for Lethbridge (Mr. Buchanan), .who is an excellent journalist, whose paper I like to read even when it is against me,

[DOT]from sending his newspaper into Eastern .Canada, and papers published in Montreal, papers published in Quebec, papers published in Halifax, will not circulate in the various provinces west of lake Superior. Is that a healthy condition for this country to establish? I ask my hon. friend to pause and to think seriously before putting this legislation through. You are dividing this country; you are creating the very sectional sentiment which every true patriot must combat to the best of his ability. You are complaining of having three political groups. My good friend the hon. member lor Simcoe North (Mr. Currie) carries with him the claymore of his- ancestors whenever he meets the gentlemen who represent the Farmers' party in this House. He complains bitterly about this evidence of a purely sectional group in Canada. He does not want to see those farmers and their farmer associations thinking only for themselves and of themselves. He wants them to be imbued with the thoughts, ideas and principles prevailing in the industrial centres of Ontario. He is not far wrong in that, so far as ideas are concerned.


Mr. CURRIE:: First of all, I should like to know when I said all this. The hon. member cannot point to a single word that J said this session or last session against the Farmers' group. The hon. member is framing all this up out of his imagination, "but it is so beautiful that I cannot help listening to it.


Rodolphe Lemieux: I must remind my hon. friend that I have been a journalist, and perhaps some stretches of imagination are permissible. But is it not a fact that this legislation is sectional legislation?


Martin Burrell: In what respect?


Rodolphe Lemieux: You are going to close the avenues between the East and the West.


Charles Joseph Doherty: By what provision of
this legislation are we closing the avenues and making the thing sectional?


Rodolphe Lemieux: By creating a zone system and giving them a special rate.


Charles Joseph Doherty: Has the hon. gentleman read the resolutions, and if so, does he not see that there is no zone system in them?


Martin Burrell: : I must say to my hon. friend very confidently that while the zone system was discussed and considered, the idea was abandoned, and there is in the resolution no zone system except the old regulations which obtained even when he was Postmaster General.


John Allister Currie: I might also say for the benefit of the hon. gentlemaif that when the Bill comes down I will try to take occasion to remind him of a few things that happened during his regime as Postmaster General, when we used to have a few words to say in the House.


Rodolphe Lemieux: I am quite ready to wait until the Bill is printed, but at first sight, I say that you are increasing the rates per zone. That is how I read the resolution, and whilst a certain rate will prevail in one zone, the same rate will not prevail in another zone.


Martin Burrell: That is not so.


Rodolphe Lemieux: So much the better if I am mistaken, but I read the resolution that way, and I will wait until the Bill is printed. But if I am in error, I am in error in company with many journalists, because, as former Postmaster General, I have been showered with protests from all parts of Canada against the resolution which has been presented this evening.


Mr. DAVIDSON:: Probably they are
reading your own papers.


William Stevens Fielding: How does this resolution affect the transportation of magazines?


Martin Burrell: A magazine is not
regarded specifically as a magazine; it comes under the newspaper class. Has my hon friend (Mr. Lemieux) concluded his remarks?


Rodolphe Lemieux: No. My hon. friend says that the rate is not raised.


Martin Burrell: I never said so at all. 1 explained that the rate was raised, and I thought I explained it in fairly clear English. I said that no zone system was established except in so far as it has always been established, even during my hon. friend's regime, in the forty mile limit for weekly newspapers.


Rodolphe Lemieux: Clause 3 reads:
That subsections two and three of section fifty-three of the said Act, as amended by section five of chapter fifty-three of the statutes of 1908, be repealed, and the following substituted therefor:-
(2) Newspapers and periodicals required to be transmitted by mail within a distance of forty miles from the place of publication, the publication of which is of no greater frequency than once a week, which have a circulation by mail of not more than one thousand copies per issue, and which are published in any city, town or village which has a population of not more, than five thousand persons, shall be transmitted free of postage within such area.



But without such area, what will be the rate?	*
(3) Newspapers and .periodicals which are required to be transmitted for a greater distance than is mentioned in the last preceding subsection-
Is not that another zone?
-or the publication of which is of greater frequency than once a week, shall be subject to postage at the rate of one cent-
There is an increase there.
-on and after the first day of January, one thousand nine hundred and twenty-one, and until the first day of January, one thosand nine hundred and twenty-two, and one and one-half cents thereafter, for each pound weight or any fraction of a pound weight, and such postage shall be prepaid by postage stamps or otherwise as the Postmaster General from time to time directs.
My expression may be loose, but I am, * in essence, absolutely correct. You are raising the rate for passing from one district to another, if you prefer the word "district" to the word "zone", and you are adding six times the rate for passing from one district to the other. My hon. friend is playing upon words, and that is unworthy of him. I say that he is creating a zone system, and for passing from one zone to another he increased the rate. The journalists and newspaper proprietors know what they are talking about and they are protesting against this resolution, because they know that in the end they will have to pay the piper. What I am saying this evening-with some warmth, I agree-is on behalf of the real newspaper, the torch-bearer, not the advertisement monger. I am speaking for the real journalist, the real newspaper, the disseminator of news and knowledge as the word is defined in the Post Office Act. I agree that, for many years, many so-called newspapers have been transgressing the law, but it is the duty of the Postmaster General to prevent that. I regret that the Postmaster General is not in the House, and again I say that, precedent or no precedent-perhaps this is a hobby of mine-ministers who have a seat in the other chamber should, by the rules of Parliament, be allowed to appear before this assembly to explain their measures, just as ministers having a seat in this House should be' allowed to appear in the other chamber to explain their measures.
I think that reform has to come some day. As I said1 a moment ago, when the Bill is printed we shall have occasion to discuss this question further; but- I regret that the Government has come to the conclusion that knowledge, thought and education should be 
taxed. II was under the impression that having taxed almost everything they could think of, they would at least respect, those untaxable ethereal things such as knowledge, genius, art and public opinion as expressed by the writers in the press1. 1 think that on the whole, with very few exceptions, we have a clean press in Canada. On the whole, the periodicals of Canada are quite a credit to the country. In Toronto, in Montreal, in Halifax and in the (West there are periodicals which are a credit to this country. From what I can gather, the Canadian periodicals have an elevating effect on the public mind, and I cannot resist the temptation to read a letter which I have received bearing date May 12,	1920 from the
"Woman's Century, a national journal of education and progress .by Canadian women, and official organ of the National .Council of Women of Canada." I should like my hon. friend to listen to this letter, because it is most important and has a special hearing on this, question. With the cost of newsprint as it is, and with the high cost of living and the increase in wages, the task of publishing a newspaper or periodical to-day bears very heavily on the shoulders of the poor publisher. The letter I have received' is as follew-s:
Dear Sir:	I see that the Hon. Mr. Burrell,
Minister of Customs and Inland Revenue, has given notice of a resolution to be moved in the House regarding an increase in postage rates on newspapers, magazines, etc.
As President of the Womans' Century, I wish to point out certain things which I would beg you to take into very serious consideration on behalf of this publication and of the work that it is doing.
The magazine was launched in 1914 and has gone steadily forward in spite of the serious years of war and reconstruction. It is the organ of several national and provincial women's organizations throughout the Dominion and has a large circulation amongst women of all types. Its great object has been to educate womeD along social lines, to give them a good, stable understanding of public questions, and to put before them certain ideals for the nation. To this end such methods as "Made-in-Canada" programmes, child welfare, public health, Can-adianization and many other kindred subjects have received very constant and careful. attention.
During the reconstruction period we have had articles appealing to the women to use their influence in steadying our national life and in opposing any form of unconstitutional movement or Bolshevism. That the paper is doing fine work is proved by constant letters of appreciation and interests from people all over the Dominion and outside it.
If this bill should be passed, this good work would be very seriously hampered, and I feel one of the contributions that women are giving to the national life would suffer a kind of defeat.
I trust that you will be able to give your serious consideration and do all in your power

to help such magazines as this over the threatened danger. 1 might add that should magazines of this type be cut down, then there would be an incoming of American magazines with non-Canadian ideals, which in my opinion would be most dangerous to our country.
Yours sincerely,
Constance E. Hamilton, President, Woman's Century Limited.
I trust my hon. friend will pay attention to this appeal and take into due consideration the statements which are made in the letter. Now, let me tell my hon. friend that this increased tax on newspapers and periodicals will reduce the circulation of our Canadian periodicals and may .bring some of them under the hammer. This tax may drive them to the wall, and it certainly will prevent this campaign of Canadianization which .is mentioned in Madame Hamilton's letter, while the wealthy newspapers of the United States, including the Hearst publications, will flood our country. Already, Mr. Chairman, the people of Toronto are protesting vehemently against the inroads of such publications as the Hearst journals. The United States can dump their newspapers into Canada just, as before the anti-dumping legislation of my hon. friend from Shelburne and Queen's (Mr. Fielding), they dumped their excess goods here. They can dump their newspapers and their periodicals, and jam the postal cards with their yellow literature. Of course, Mr. Chairman, I am not speaking of such newspapers as the New York Post and the Tribune, or such periodicals as The Century, the Atlantic Magazine or Munsey's. I do not refer to such publications, but I am speaking of the ugly, yellow American magazine. By this legislation you are precluding our own people from publishing and circulating clean .Canadian literature and clean Canadian thought and ideals, while you are opening the door to a flood of Yankee yellow literature.


Mr. BUCHANAN:: I may as well confess at once that I happen to be personally interested in this resolution and I think it might be well if I placed before the committee the view of the Canadian daily newspapers, First of all, I will admit that when the question of postal rates came up they proposed an increase of their own which they were prepared to accept. The daily newspapers of Canada throught their association are in favour of a certain increase in postal rates, for the reason that they do not feel that the newspapers of Canada should be blamed for any deficit that might exist in the Postal Department. They do not claim that the increase will overcome 2131
that deficit, but they do not want the newspapers to be regarded as one of the causes of the deficit. The association met a month or more ago and conferred with the Postmaster-General and the Deputy Postmaster-General and proposed that the first increase should be from one-quarter cent to one-half cent. I know that the present proposal is not agreeable to many newspapers because they cannot meet such a heavy increase at once. They would rather have the increase from a quarter to a half in the beginning of next year, then an increase to a cent, and then an increase to a cent and a half if necessary. They take the ground that they do not want to be treated by the Post Office Department or the Country as a charitable institution.


An hon. MEMBER:: That is the case now.


William Ashbury Buchanan: I may point out that a newspaper that has to meet an increased cost of this character cannot place it immediately on their customers. Subscriptions have been taken from the 1st of January this year up to the present time, and they apply for two years, and until that time the rates cannot be raised in respect of persons who have subscribed so far. These increased costs will eventually mean increased subscription rates; there is no doubt about that. In Alberta at the present time, owing to the rising cost of newsprint and the proposed increase in postal rates, the newspapers of Calgary and Edmonton have increased their rate to 25 cents a week for papers delivered in those cities, a matter of $13 a year, and to outside points the subscription has been raised from $5 to $8. They are starting out to meet the increased cost that will surely have to come to all the newspapers in Canada. These rising costs they must meet by increased subscription and advertising rates. I am not asking the Government not to make any increase at all; I am quite agreeable to an increase, but I think it should be graded a little differently front what is proposed here. I would not pbject of the cent rate were put into effect later but newspaper men think that a 300 per cent increase is pretty heavy to start with. If we were to start with a half a cent, then increase to a sent and then to a cent and a half later, they might make it up on their extra costs.
I might say in behalf of the newspaper publishers that the situation is extremely serious among the newspapers of the country largely due to the increased cost of newsprint. Prior to the war newsprint was selling at $40 a ton. It will be $80 to the end
[DOT]3354

of June, but it is going up to $120 the beginning of July. These costs, postal rates and all, have to be met. If the burden were made a little less at the present time and were increased gradually I do not think there would be any objection from the Canadian daily, newspaper publishers. They did meet the Postmaster General and were agreeable to an increase of half a cent. They would like that increase to be put into effect first and that the other rates should be imposed in six months or a year if necessary. I thought it might be worth while for the committee to understand the attitude of the daily newspaper publishers and that is the reason why I have made this statement on the question.


Peter McGibbon: I am
thoroughly in accord with the spirit of this resolution. Although I am directly, or indirectly, associated with the publication of newspapers I do not see why the Government should carry my newspapers or any other people's newspapers for nothing. It is an absolute business transaction and we have the postal department running behind to the extent of $7,000,000 a year. This is not business. We could stand it probably in pre-war days and have some excuse for it but to-day, when we have to exert ourselves to the very utmost, and to impose taxation to the limit, I do not see why we have any reason to carry on a department of this Government in such an unbusinesslike way. If it is true, as has been said, that there are hundreds of employees in different parts of this department that are useless, for goodness sake, let us get down to the time when we can run every department of this Government on a business basis-lop off the mouldering branches, get new methods if necessary and new men and let us put this country on a paying basis. Probably I have not the same respect for free thought that some hon. members have. I am very doubtful if the newspapers of this country contribute very muph to it. The Associated Press is a great distributor of news and that goes over the wires. It is not transmitted by the mails. As far as the editorials are' concerned, I think they reflect to a great extent the opinions of one man and that man is the editor, whoever he may be. This is a public matter; we are here to look after the business of the people of Canada; and what right have we to carry newspapers to the extent of $6,000,000 or $7,000,000 a year for nothing, at a time when we are imposing taxation on the people? If newspapers cannot carry on at the present rates they have their remedy the

same as any other business man has; let them increase their advertising and circulation rates and not come down here and ask this Government to dole out charity to anybody. We are here to conduct the business of Canada in a business way and I hope the minister will go farther than the resolution specifies. I do not know why weekly newspapers should be carried free. They should carry a legitimate charge for transmitting their knowledge. Newspaper publication is a business; the publishers are conducting that business for a personal gain and profit. I have never yet seen any great philantrophy among the newspaper men and . publishers of this country; it is absolutely cold business; and it is up to this Government to conduct the business of this country in such a cold-blooded manner as to make the business of the country pay as we go. Canada is heavily in debt. The Lord knows we have to impose burdens enough on the people, and I do not think any appeal to charity is at the present time in order.


Mr. PARENT:: I want to say a word now, reserving until later whatever remarks I shall have to make on this subject. I understand that the purpose of this resolution is to get revenue, and such being the case probably the service of the department could be improved. I would call the attention of the minister to the fact that when a holiday falls on Monday the distribution of the mails in the cities is not made from Saturday noon till the next Tuesday which causes a good deal of damage to trade generally. My attention has been called by associations of merchants and all kinds of persons to this matter and I hope the minister will take it up with the department, and that the public in general will have reason to appreciate his intervention.


Martin Burrell: In answer to my hon.
friend from East Lambton (Mr. Armstrong) who brought to my attention the fact that a thousand in regard to the weekly newspaper was a somewhat low figure for circulation free and that it should be extended to two thousand, there is a good deal in what he says. Now, I shall be personally very glad to give the maitter consideration and I think we may take that up when the Bill is introduced. My hon. friend from Resti-gouche and Madawaska (Mr. Michaud) touched on the same question but he went somewhat farther and argued that as a matter of principle papers such as those that he referred to should be allowed free mailing privileges altogether. I do not

know on what principle we could lay it down that newspapers of any kind should be allowed to pass through the mails free. If we carried that out to its logical conclusion, as my hon. friend from Muskoka (Mr. Mo-Gibbon) has pointed out, the rest of the people who are not interested in these papers would be subsidizing them out of their own pockets. However, I shall be glad to give consideration to the question of the weekly newspaper and take it up on the second reading.
I would like to say a word or two in answer to the hon. member for .Maison-neuve (Mr. Lemieux), whose remarks, I must confess rather asitonished me. I am not going to follow him in his remarks about what was prior to 1896 the excellence of the administration of the department and the unfortunate depravity since that time, because I do not think it would be w.orth while going into that question. All the reforms which my hon. friend, or his predecessor, put into effect ought to make us rejoice, and if there was a complete absence of all kinds of abuses during the administration he can take comfort to his soul that such was the case, although I think that probably I could pick some flaws,-however, I shall not go into that question. I can say, however, that if there is a tremendous extension and an increase in the number of employees far in excess of what is absolutely justified by the service. I am sure that every member of this House, I do not care on which side he sits, will feel that such an increase should be wiped out of existence and that the service should be put upon a basis of business efficiency. In that the hon. gentleman does not feel any more -strongly than I do myself.
May I say a word about my hon. friend's remarks, the'tone of which I thought was entirely uncalled-for. He speaks about this part of the resolution being a "tax on free thought." It is not a question of a tax; it is a question of trying to make up from the users of the mail something of the enormous deficit which imposes a burden on the whole country. It is not a question of taxing free thought, it is asking the newspapers whose business results in a loss of some four or five million a year to the Government to bear a somewhat heavier share of the cost in order that we may at least do something towards making up the deficit. If my hon. friend can construe that into an attempt to tax thought we will never agree on a definition of what a tax is. My hon. friend asked us to seriously consider before we take that step, but I wish he had considered this
thing a little more himself. He is absolutely wrong when he talks about a zone system in referring to the forty-mile district in which a weekly newspaper may be carried free.
Mr. LEMilEUX:	What would you call
it?


Martin Burrell: That is the forty-mile
district for a weekly newspaper, but what my hon. friend has in his mind is that the newspapers which have been writing to him and to me were afraid that there was going to be what is known generally as the zone system, namely, that beyond a 300-mile line there was going to be an additional charge. That is what is known to the newspaper men as the zone system, That zone system is not in this resolution, but the forty mile limit for weekly newspapers is precisely as it was under the old administration, except that we ask that from the central point of publication the distance shall not exceed forty miles.


Mr.   OOWAN@: That does not apply to
dailies.


Martin Burrell: Not to dailies. There is some misapprehension as to that. My hon. friend talks eloquently about the sword of the ancestor of the hon. member for North Simcoe and so on. I am not going to follow him in anything of that kind. But there was one other thing the hon. member said he would like to touch on. He said that he himself was here as an advocate of those high exemplars of thought in the newspaper world, the torchdoearers as he called them, and he seemed to have some extraordinary idea that we were encouraging all the worst forms of the press and were suppressing in some mysterious way the "torch-bearers" that he alluded to. Well, I will just say that our definition of the press is precisely what was in the Revised Statutes in 1906 and was in effect in my hon. friend's regime. Paragraph (a) of section 53 of the old Act reads that:
A newspaper is known and recognized as a newspaper or periodical in the general sense of the word, and consists wholly or in great part of political or other news, or of articles relative thereto, or on other current topics, and is published regularly at intervals of not more than one month.
Now it is no good for my hon. friend to talk about "suppressing" the "torch-bearers." .There is a definition of a newspaper that existed in the Act when my hon. friend was Postmaster General, and it is precisely that definition under which we are working

to-day, and there is no proposal to change it. I may say that we do require a reasonable and proper amount of reading matter and political and other news, before the publication can be classed as a newspaper, and get the benefit of these rates, because it was not thought desirable that papers should go out with an overwhelming mass of advertising and a minimum of news.
Now in reference to this whole matter, if my hon. friend has any other thoughts that would bear more directly on the question than those he has expressed to-night, or any suggestions to make, I need hardly say-as the minister who is piloting the Bill through this House-that I would be only too glad to give them the greatest consideration. I must, however, take a strong exception to his view of this proposal to try and see that the newspapers of the country pay at least a little more than they have been paying towards the very heavy load which we have been carrying for them, and I must deprecate his citing that as "attacks on free thought'' in any shape or form.
I may say in answer to my hon. friend from Lethbridge (Mr. Buchanan) that I know the views he has placed before the committee to-night are the views that have been expressed from a great many quarters in Canada to me-and I suppose to the Postmaster General-during the last few weeks. I am quite aware that the newspapers are facing somewhat hard conditions in regard to their supply of newsprint and its increased cost. At the same time whatever is finally decided-whether we adhere to the provisions of the resolutions and the provisions of the Bill which is to be founded upon those resolutions or whether there is any modification-what I have stated before must not be forgotten, that even whatever amount we do advance these charges by, owing to the necessary increase in the railway charges which is bound to come, the department and the country-because the department represents the country-will be facing an enormous deficit even if you charge up to one cent. However, I think that matter could better be discussed at a later stage.


James Dew Chaplin: I would like to get the
figures of the cost of carrying these newspapers, and what revenue we propose to get from that. The minister has stated that we are carrying 87,000,000 pounds of paper at the present time, and the revenue derived therefrom is $290,000. He proposes

to impose a rate of four times the present amount, and even that increase will not pay the cost of handling. I would like to get the exact figures.


Martin Burrell: It would be difficult to give the figures with any absolute exactitude to-night. I have given a rough estimate for the purpose of explaining the general sense of the resolutions. I could give the figures more accurately when the Bill which is to be founded on the resolutions comes up for second reading. It is right, as my hon. friend states, that we charge a quarter of a cent a pound for carrying newspapers at present. The revenue from this source has been about $291,000, and the extent of the loss entailed by the carrying of these newspapers is estimated to be pretty close to $5,000,000. Under the terms of the resolution the rate for carriage is increased from a quarter of a cent to one cent per pound, tout even if that proposal is carried out it will certainly he very far from meeting anything Kke the expenditure involved.


John Allister Currie: Is the minister prepared to give the committee the amount that is lost on the distribution of catalogues and also on the carriage of parcels? I understand there is an annual loss of from twenty to thirty millions in the carrying of parcels for the departmental stores, figured on the same basis as that for the carriage of newspapers?


Martin Burrell: If my hon. friend will permit me I will give that information upon the second reading of the Bill. I will say in passing that I am quite aware that while there may be differences of opinion with respect to certain provisions in these resolutions there is no necessity for altering the resolutions now. Nor is there any grave reason why the passage of the resolutions should be delayed. I am giving a running explanation of their purpose in order that when the Bill comes before the House all the varying views that members may entertain may be advanced perhps with greater effect. I will finish, therefore, with a comment on the other clauses.
It is proposed to repeal the old sections 75, 76, 79 and 81 which deal with the question of franking, and to substitute certain other clauses which in the main amount to this: Whereas in the past it was customary not only for all departmental literature and letters, and mailable matter of all kinds, to be sent from the seat of Government by departments, and by members and senat-

ors, it was also customary for all mailable matter and letters addressed to any department of government by a member to come in free. That part is deleted, and while the privilege is retained of franking departmental literature and government publications, and members' mailable matter and letters, being still franked out they will not come in free. I think myself that this is a wholesome.reform because there has been a tremendous abuse of the franking privilege generally, and certainly a very great loss of revenue. The franking privilege hitherto enjoyed by the provinces for the distribution of all their government publications is also cut out. There are hundreds of tons of government publications in the various provinces going out free, and the department thought there was really no reason why the Dominion Government and the people of Canada from a federal standpoint, should carry free the mails of a province, when, after all, each province is perfectly able to attend to that matter itself.
I might mention that a penalty is provided for the franking of matter that does not deal with the personal affairs of a member or senator. I think I am well within the mark when I say that the franking privilege by members has been abused, not so much willingly by the member himself as by all sorts of pressure from other people who got him to frank their letters and he himself was not in the position-without being extremely ungracious-of refusing them, although the course in question certainly was not justified. This simply gives him a reason by which he can say to anybody, "1 am not permitted under the law-a violation of which will lay me open to a penalty-to frank your letters, or the letters of your friends' friends at the public expense simply because you are my friend." The changes proposed will cut that practice out. I need only give an illustration of the abuse of this privilege by saying that years ago when members of the Civil Service were allowed to frank their letters a boarding house in Ottawa advertised its advantages as such by reason of the fact that it had civil servants there, and that those civil servants would frank all the letters of the people who came to the house. There were also times in the old days when members came to Ottawa and found that it was a very expensive business to do their laundry here and so franked their washing home, got it done there and then brought it back. I remember an instance related by the late Sir Hector Langevin that when he was Minister of Public Works at one time they could take down to the station in a small bag the mail matter franked from the Department of Public Works. Suddenly there was an
enormous increase and they found there were merchants and other people coming into the department and unloading whole truck-loads of stuff there because all the departmental matter went through the mails free. In England the abuse was equally flagrant, in fact the system was abused to such an extent that members were known to frank even pianos down to their constituencies. It led in England to the wiping out of the whole privilege. Although that policy has since been reversed, the privilege has been greatly restricted. Here, in the public interest, we are going to at least wipe out the greater abuses in connection with the franking privilege. I think that is all I need say in comment on the resolutions.


Rodolphe Lemieux: Is it proposed to preclude the franking of campaign literature?


Martin Burrell: I would not say that, because as I understand the resolutions anything to do with the business of the Government, or public business, goes free. I take it for granted that my hon. friend would not send out as campaign literature anything that did not deal with public business.


Mr. THOMPSON (Yukon):: I would like to ask a question of the minister with reference to the franking privilege. I notice that in subsection 2 of section 76 it is declared:
All letters posted for transmission under this section must be franked by the personally written signature of the member of the Senate or of the House of Commons sending the same.
Does that mean that we shall not be permitted to frank by our^initials?


Martin Burrell: I would not like to
speak positively on that point. I think the view of the department is that the initial franking has been very much abused; and, strictly speaking, a frank should be a signature. The latter method is a very much greater protection to the department. On the other hand, I think the question might well be dealt with, and I will find out further about it.


John Allister Currie: The written signature is
specified here in the same clause. Lots of members have often in the neighbourhood of 200 letters a day, and to have to sit down and sign that number of envelopes is a nuisance. In addition it would preclude
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issuing a number of circular letters to a member's constituents. Why not change the wording so that a member's personal stamp could be adopted in lieu of his signature?


Martin Burrell: The facsimile can be
used on all mailable matter.


John Allister Currie: That is only on open mail other than letters.


Martin Burrell: Yes. It may be a
hardship. On the other hand, I know when I was Secretary of State I personally had to sign my signature to far more than 200 or 300 certificates of naturalization, company charters, and so on.


William Stevens Fielding: Is printed matter enclosed in an envelope a "letter"?


Martin Burrell: I presume it would be
if sealed.


William Stevens Fielding: Most of the printed
matter that goes out is in closed envelopes.


Daniel Duncan McKenzie: When the stamp rate was raised from 2 to 3 cents as a war tax, the question of whether or not a constituent sending letters to' his member would have to stamp them was raised, and I have a distinct recollection of the then Minister of Finance (Sir Thomas White) holding that it was in the public interest that the communication with a member should be kept free. I am disappointed to find that the privilege is being removed. I do not know why this change of policy has been adopted by the same Government.


Martin Burrell: Is my hon. friend drawing a distinction only so far as letters addressed to members are concerned? He does not suggest that letters addressed to all departments of government should be free? My hon. friend will understand that an enormous number of inquiries are sent in to the various departments, and in ordinary cases it would be worth a man's while if the information he is inquiring about is of any value to him at all to affix a three-cent stamp to his letter. The floods of correspondence of that kind entail a very heavy loss of revenue. However, this point can be taken up.


Daniel Duncan McKenzie: That point was raised on the occasion I refer to.


Martin Burrell: It can be given consideration.
Resolution reported without amendment and concurred in.

Mr. BURRELL thereupon moved for leave to introduce Bill No. 167 to amend the Post Office Act.
Motion agreed to and Bill read the first time.
On motion of Rt. Hon. Mr. Doherty, the House adjourned at 12.10 a.m. (Thursday).
Thursday, June 10, 1920.